What is a VA loan and who is eligible?

A VA loan is a mortgage guaranteed by the U.S. Department of Veterans Affairs, available to active-duty service members, veterans, National Guard members, reservists, and eligible surviving spouses. Eligibility requires a minimum length of service (typically 90 days of active duty during wartime or 181 days during peacetime, or 6 years in the National Guard/Reserves). VA loans are originated by private lenders but backed by the government, allowing favorable terms including 0% down.

What is the VA funding fee and how much is it?

The VA funding fee is a one-time upfront cost that funds the VA loan program, replacing the monthly mortgage insurance that other loan types charge. For first-time use: 2.3% with less than 5% down, 1.65% with 5–9.99% down, and 1.4% with 10%+ down. For subsequent use: 3.6% with less than 5% down, 1.65% with 5–9.99% down, and 1.4% with 10%+ down. The fee can be financed into the loan. Veterans with a service-connected disability rating of 10% or more are exempt.

Can I get a VA loan with no down payment?

Yes — VA loans allow 0% down payment, which is one of their biggest advantages. This is possible because the VA guarantees a portion of the loan (typically 25% of the conforming loan limit), reducing the lender's risk. With no down payment requirement and no monthly PMI, VA loans offer the lowest barrier to homeownership of any loan type for eligible borrowers.

Does a VA loan require PMI or monthly mortgage insurance?

No. VA loans do not require any form of monthly mortgage insurance — neither PMI (like conventional loans) nor monthly MIP (like FHA loans). The VA funding fee is a one-time upfront cost that replaces ongoing mortgage insurance, which can save borrowers $100–$400 per month compared to conventional or FHA loans with less than 20% down.

What is the VA entitlement and how does it work?

VA entitlement is the amount the VA will guarantee on your loan. The basic entitlement is $36,000, and the bonus entitlement (for loans above $144,000) brings the total to 25% of the conforming loan limit. In 2024, the full entitlement allows loans up to $766,550 with no down payment. For loans above this amount, a down payment is required for the portion exceeding the entitlement. Entitlement is restored after a VA loan is paid off, allowing reuse.

Can I use my VA entitlement more than once?

Yes, VA entitlement can be restored and reused. Once you sell the property and pay off the VA loan in full, your full entitlement is restored. You can also have two VA loans simultaneously if you have remaining entitlement — useful when moving to a new duty station without selling the previous home. However, subsequent-use funding fees are higher (3.6% vs 2.3% with less than 5% down).

Are VA loans better than conventional loans?

For eligible borrowers with limited down payment cash, VA loans are almost always cheaper. With 0% down and no PMI, the VA loan's total cost is typically lower than a conventional loan with 5% down (which requires PMI). However, the funding fee adds to the loan balance, so if you have 20% down and strong credit, a conventional loan might be comparable. The VA loan's advantage grows as the down payment decreases.

Can I use a VA loan for an investment property or second home?

No. VA loans are only for primary residences — you must intend to occupy the home within 60 days of closing. However, VA loans can be used for multi-family properties (up to 4 units) as long as you live in one unit. After the one-year occupancy requirement, you can move out and rent the property, then use your restored entitlement to buy another primary residence.

VA Loan Calculator

A VA loan calculator is a free online tool that estimates your VA home loan payment including the funding fee. It shows zero-down-payment options with no PMI and your total monthly payment with taxes and insurance. Free, no sign-up required.

VA Loan Details

Home Price?The purchase price of the home you're considering buying.

Down Payment

Interest Rate?The annual interest rate on your mortgage loan.

Loan Term?The length of your mortgage in years. Common terms are 15 or 30 years.

Property Tax Rate?The annual property tax rate as a percentage of home value.

Home Insurance?Annual homeowners insurance premium.

HOA Fees?Monthly homeowners association (HOA) fees, if applicable.

Entitlement Use

Disability Exemption (10%+ rating)

End of inputs

VA Loan Results

Monthly Payment

$2,526.98

Total / month

Total Loan Amount

$358,050.00

incl. funding fee

Total Interest

$394,165.36

Over 30 years

Funding Fee

$8,050.00

2.30%

P&I Payment

$2,089.48

Per month

Base Loan

$350,000.00

Before funding fee

Monthly Payment Breakdown

Amortization Schedule

Payment Schedule

Month	Principal	Interest	Balance

360 months · Showing 0 rows

Key Insights

Your VA funding fee of $8,050.00 (2.30%) is financed into the loan. While this adds to your balance, it's a one-time cost — VA loans have no ongoing monthly mortgage insurance like FHA or conventional PMI.

Over the life of this loan you'll pay $394,165.36 in interest — more than the loan principal. A shorter term (e.g. 15 years) or extra payments could dramatically reduce this cost.

VA is an excellent fit for your scenario: no down payment required, no PMI, and competitive rates. For borrowers with limited cash for a down payment, VA loans offer the lowest total cost of any loan type — if you're eligible.

You're putting $0 down — the signature benefit of a VA loan. With no down payment requirement and no PMI, VA financing is one of the only ways to buy a home with truly no money down. Just be aware that a 0% down payment means you start with no equity, which makes selling in the first few years riskier if home values decline.

Your VA rate of 5.75% is in line with recent market averages. VA loans typically offer rates 0.25%–0.5% below conventional, making this competitive — especially with no PMI requirement.

VA Loan Benefits: Funding fee of $8,050.00 (2.30%) is financed into the loan. No monthly mortgage insurance (PMI/MIP) — VA loans are exempt from ongoing mortgage insurance, saving you hundreds per month compared to conventional or FHA loans.

Guide

How to Use This Calculator

1Enter the home price you're considering in the Home Price field.
2Adjust the down payment. VA allows 0% down — but even a small down payment reduces your funding fee rate.
3Set the interest rate. VA rates are typically 0.25%–0.5% lower than conventional rates.
4Choose the loan term — 30 years for lower monthly payments, 15 years to save on interest.
5Add the annual property tax rate, home insurance premium, and monthly HOA fees.
6Toggle 'First Use' if this is your first VA loan (lower funding fee) or 'Subsequent Use' (higher fee).
7Toggle 'Disability Exempt' if you have a VA disability rating of 10%+ — this waives the funding fee entirely.
8Review the funding fee and total loan amount in the results panel.

Formula

How It's Calculated

The VA monthly payment is calculated in three steps:

1. Base loan amount = Home Price − Down Payment (0% allowed)
2. Total loan amount = Base loan + Funding Fee
3. Monthly P&I = M = P × [r(1+r)^n] / [(1+r)^n − 1]
   where P = total loan amount, r = monthly rate, n = months

Total monthly payment = P&I + (Property Tax ÷ 12) + (Insurance ÷ 12) + HOA

VA funding fee rates (financed into the loan):
  First use, < 5% down:    2.30%
  First use, 5–9.99% down: 1.65%
  First use, 10%+ down:    1.40%
  Subsequent, < 5% down:   3.60%
  Subsequent, 5–9.99%:     1.65%
  Subsequent, 10%+:        1.40%
  Disability exempt:       0% (no funding fee)

No monthly mortgage insurance (PMI/MIP) is charged.

Example: $350,000 home, 0% down, 5.75% rate, 30 years, first use
  • Base loan = $350,000
  • Funding fee (2.3%) = $8,050
  • Total loan = $358,050
  • P&I = $2,092.15
  • Property tax (1.1%) = $320.83
  • Insurance ($1,400/yr) = $116.67
  • Total = $2,529.65/month (no PMI)

Glossary

Key Terms

FAQ

Frequently Asked Questions

Choose Your Use Case

Veteran / Active Military

Veteran Home Loan Guide — VA Loan Calculator Walkthrough

VA loan calculator walkthrough for veterans and active military: zero-down loans, funding fee, COE, and IRRRL refinancing.

View guide —?

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