What Is a VA Mortgage?
A VA mortgage is a home loan made by a private lender and supported by the U.S. Department of Veterans Affairs guaranty program. Eligible veterans, service members and certain surviving spouses may qualify for VA-backed home financing, subject to program and lender requirements.
VA purchase loans can offer financing without a down payment for eligible borrowers, and they generally do not require monthly private mortgage insurance. However, borrowers may owe a one-time VA funding fee unless exempt. The lender determines the actual loan terms and approval.
How to Use This VA Mortgage Calculator
Enter the home purchase price, down payment and estimated annual interest rate. Choose a 15-year or 30-year loan, indicate first or subsequent VA loan use, and select whether the funding fee is exempt, financed or paid upfront.
Add estimated monthly property taxes, homeowners insurance and HOA dues. The calculator updates your principal-and-interest payment, total estimated monthly housing payment, funding fee, financed principal and upfront cash estimate.
Use the balance chart and amortization schedule to see how scheduled payments reduce principal and accumulate interest over the selected loan term.
What Is Included in the Monthly VA Mortgage Payment?
The principal-and-interest payment is calculated using the financed loan balance, fixed annual interest rate and selected repayment term. If the funding fee is financed, it becomes part of the loan principal.
The estimated total monthly housing payment also includes the property tax, homeowners insurance and HOA amounts entered. These expenses are estimates and may change over time. This model does not add monthly PMI or FHA MIP.
How VA Purchase Funding Fees Work
The VA funding fee is generally a one-time charge associated with VA-backed loans. For the standard purchase-loan schedule modeled by this calculator, the fee depends on the down payment percentage, whether it is a first or subsequent use, and whether the borrower is exempt.
| Down payment | First use | Subsequent use |
|---|---|---|
| Less than 5% | 2.15% | 3.30% |
| 5% to less than 10% | 1.50% | 1.50% |
| 10% or more | 1.25% | 1.25% |
These are the standard VA purchase funding-fee rates effective April 7, 2023, used in this calculator. The fee is applied to the base loan amount after subtracting the down payment, not to the full home purchase price. Exempt borrowers have a modeled fee of zero. Other loan programs and special circumstances may use different rules.
Confirm current rules and any applicable exemptions with the Department of Veterans Affairs.
Financing the VA Funding Fee vs. Paying It Upfront
Financing the funding fee adds it to the mortgage principal. This can reduce the modeled cash needed upfront, but it also increases the amount borrowed and can increase total interest over the loan term.
Paying the funding fee upfront keeps that fee out of the mortgage balance. The calculator's estimated upfront cash includes the down payment plus any funding fee selected for upfront payment. It does not include other closing costs, prepaid expenses or initial escrow deposits.
VA Loans, Down Payments and Mortgage Insurance
VA purchase loans may allow eligible borrowers to buy a home with no down payment. A down payment can still reduce the amount borrowed and may lower the applicable funding fee.
Unlike many conventional loans with small down payments, VA loans generally do not charge monthly private mortgage insurance. The VA funding fee is a separate one-time cost, not a recurring monthly mortgage insurance premium.
Understanding the VA Amortization Schedule
The amortization schedule separates each scheduled mortgage payment into principal and interest. Early payments on a typical fixed-rate mortgage generally include more interest, while later payments generally repay more principal.
The balance chart illustrates the declining mortgage balance and cumulative principal and interest over time. Taxes, insurance, HOA fees and upfront expenses are not included in those three chart series.
VA Mortgage Calculator Limitations
This calculator models standard fixed-rate VA purchase-loan scenarios. It does not model VA refinances, Interest Rate Reduction Refinance Loans (IRRRLs), cash-out refinances or other special funding-fee schedules.
It does not determine VA entitlement, Certificate of Eligibility status, occupancy eligibility, income qualification, credit approval, appraisal requirements, lender fees or actual loan availability. It also excludes closing costs, prepaid expenses and escrow deposits from the estimated upfront cash figure.
Interest rates, taxes, insurance and HOA costs are illustrative inputs, not guaranteed quotes. The lender offers displayed with the calculator are not necessarily VA loans. Obtain a lender Loan Estimate and verify VA requirements before making a financing decision.
Frequently Asked Questions About VA Mortgages
Can I use this VA calculator with no down payment?
Yes. Enter a zero down payment to estimate a purchase loan with no down payment. Whether zero-down VA financing is available depends on eligibility, entitlement, the property, the lender and applicable requirements.
What is the VA funding fee for a first-time use?
For the standard purchase-loan schedule modeled here, the funding fee is 2.15% with less than 5% down, 1.50% with at least 5% but less than 10% down, and 1.25% with at least 10% down. Exempt borrowers pay no funding fee.
Is the VA funding fee higher for subsequent use?
For the standard purchase-loan schedule, subsequent use has a 3.30% fee with less than 5% down. The modeled rates are 1.50% with at least 5% but less than 10% down and 1.25% with at least 10% down.
Can the VA funding fee be financed?
The calculator lets you compare financing the funding fee into the mortgage with paying it upfront. Financing the fee increases the starting loan balance and usually increases total interest.
Who is exempt from the VA funding fee?
Certain eligible borrowers are exempt under VA rules, including some veterans receiving qualifying service-connected disability compensation. The calculator provides an exemption switch but does not verify exemption status.
Does a VA mortgage require monthly PMI?
VA loans generally do not require monthly private mortgage insurance. The calculator therefore models no monthly PMI or FHA mortgage insurance premium. Other housing costs still apply.
Does this calculator determine VA loan eligibility?
No. It does not verify military service, a Certificate of Eligibility, entitlement, credit, income, occupancy, property requirements, loan approval or lender-specific conditions.
Are the displayed mortgage offers guaranteed VA loans?
No. Offers from participating lenders may represent other mortgage programs. Ask each lender whether a VA purchase loan is available and confirm its rate, fees, requirements and loan terms.
Related Mortgage Calculators
For a standard fixed-rate mortgage comparison, use our 30-year fixed mortgage calculator. To estimate a potential homebuying budget, try our mortgage affordability calculator.
These estimates are for education and financial planning. They are not a loan approval, a determination of VA eligibility or a guarantee of financing or lender terms.