VA Mortgage Calculator

Understanding VA Mortgage

A VA mortgage is a special type of home loan backed by the U.S. Department of Veterans Affairs. It's designed to help eligible veterans, active-duty service members, and certain military spouses purchase, refinance, or build a home with more favorable terms than traditional loans. These loans often require no down payment and offer competitive interest rates.

What Makes a VA Mortgage Different?

Unlike conventional loans, a VA mortgage is guaranteed by the federal government, which reduces the lender's risk. As a result, borrowers can access:

• No down payment (in most cases)
• No private mortgage insurance (PMI)
• Lower interest rates
• Flexible credit requirements

Who Qualifies for a VA Loan?

To be eligible for a VA mortgage, you must meet at least one of the following:

• Served 90 consecutive days of active service during wartime
• Served 181 days during peacetime
• Served 6 years in the National Guard or Reserves
• Be the surviving spouse of a service member who died in the line of duty

You'll need a Certificate of Eligibility (COE) from the VA to confirm your qualification. However, many lenders can help you obtain this during the loan process.

Types of VA Loans

VA mortgages come in several forms depending on your goals:

• VA Purchase Loan: Used to buy a home at competitive interest rates with little or no down payment.
• VA IRRRL (Interest Rate Reduction Refinance Loan): Also known as the VA streamline refinance, this is ideal if you already have a VA loan and want to lower your interest rate.
• VA Cash-Out Refinance: Allows you to refinance your existing mortgage and take cash out using your home equity.

VA Loan Interest Rates

VA mortgage rates are typically lower than conventional loan rates. However, your rate will depend on factors like:

• Your credit score
• Loan term (15-year vs 30-year)
• Whether you’ve used a VA loan before
• Market conditions

Interest rates can change daily, so it’s best to check with lenders or use a calculator to estimate current monthly payments.

What Is the VA Funding Fee?

Most VA borrowers are required to pay a VA funding fee, which helps keep the program running without taxpayer cost. The fee varies depending on your loan type, military category, and whether you’ve used the VA loan benefit before.

• First-time use: typically 2.15% of the loan amount
• Subsequent use: typically 3.3%
• Exemptions: Veterans receiving VA disability compensation may be exempt

This fee can be rolled into the loan amount or paid upfront at closing.

Do VA Loans Require Mortgage Insurance?

One of the biggest perks of a VA mortgage is no private mortgage insurance (PMI). This can save you hundreds per month compared to conventional loans that typically require PMI for borrowers who put down less than 20%.

Can You Use a VA Loan More Than Once?

Yes. You can use your VA loan benefit multiple times throughout your life. Your "entitlement" determines how much the VA will guarantee. As long as you restore your entitlement — usually by selling the home and paying off the loan — you can reuse your VA benefits.

In some cases, you may even have remaining entitlement, which lets you take out another VA loan while still holding the first one.

Property Requirements

Homes purchased with a VA loan must meet the VA's Minimum Property Requirements (MPRs). These ensure that the home is:

• Safe
• Structurally sound
• Sanitary

While VA loans allow for a wide variety of property types, fixer-uppers or homes with serious issues may not qualify without repairs.

VA Loan Closing Costs

VA loans limit how much you can pay in closing costs. Some of these costs can be covered by the seller, including:

• Appraisal fees
• Title insurance
• Recording fees
• Origination charges

That said, borrowers are still responsible for certain fees like the VA funding fee unless exempt.

Refinancing with a VA Loan

If you already have a VA mortgage, you may be eligible for a VA streamline refinance (IRRRL) or a VA cash-out refinance. These can help you:

• Lower your monthly payments
• Switch from an adjustable-rate to a fixed-rate mortgage
• Tap into your home’s equity for major expenses

Always weigh the pros and cons of refinancing, including potential closing costs and how long you plan to stay in the home.

FAQs About VA Mortgages

What credit score is needed for a VA loan?

While the VA doesn’t set a minimum score, most lenders look for a score of at least 620.

How long does it take to close a VA loan?

VA loans typically close in 30–45 days, similar to conventional loans.

Can I buy a second home with a VA loan?

VA loans are intended for primary residences only. You can’t use it to purchase investment or vacation properties.

Can I include closing costs in my VA loan?

Most closing costs can’t be financed into the loan, but the VA funding fee can be.

What is residual income in VA loans?

It’s the money left after paying major monthly obligations. The VA uses it to assess your ability to afford the loan.

Can I use a VA loan to build a home?

Yes, but it's more complex than a standard purchase loan. You'll need a lender experienced with VA construction loans.

Are VA loans assumable?

Yes. A VA loan can be assumed by another buyer, even if they’re not a veteran, with lender and VA approval.