VA Mortgage Qualification Calculator
Use our VA Mortgage Qualification Calculator to determine what size VA mortgage you qualify for as well as the the upfront VA funding fee you are required to pay based on your class of military service, the number of times you have used the VA home loan program, monthly gross income and debt expenses. The calculator also factors in your mortgage rate, loan length and down payment to show you what size VA loan you can afford. The VA mortgage program enables qualified military personnel and veterans to buy a home with no down payment.
Your monthly gross income, or how much money you make before any deductions, is one of the most important qualification inputs because the VA program uses a residual income analysis to determine your ability to qualify for a mortgage. In short, the VA wants to make sure that you have sufficient income leftover after accounting for your monthly debt expenses including your mortgage payment, property tax, homeowners insurance as well as other debt expenses including credit cards, car and student loans. Our VA Mortgage Qualification Calculator uses this residual income calculation to show you the estimated mortgage amount you qualify for.
Our calculator also factors in your type of military service as well as if you have previously used the VA program because these factors, as well as your down payment, are used to determine your VA funding fee, which is an additional upfront cost that many applicants are required to pay. The fee is typically lowest for regular military borrowers who are using their VA entitlement for the first time. Additionally, although the VA program requires no down payment, the funding fee is lower if you decide to put down at least 5%.
Your interest rate and length of your mortgage also impact what size VA home loan you qualify for. The lower your rate and longer the length of your loan, the more mortgage you can afford. The positive for borrowers is that VA mortgage rates tend to be lower than the rates for other loan programs which enables you to qualify for a larger loan. Input different values for mortgage rate and term into the calculator to determine how your estimated mortgage amount changes.
The calculator also shows you estimated total monthly housing expense including property tax and insurance so you can evaluate the all-in cost of owning a home. Additionally, our calculator determines the VA loan limit for your county. The VA loan limit is important because if your mortgage amount is greater than the limit you are required to make a down payment to be eligible for the VA program. Our VA Mortgage Qualification Calculator provides a lot of valuable information and we encourage you to run multiple scenarios to determine the VA loan you can afford. We also offer a version of this calculator that does not require personal information.
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What Borrowers Should Know About a VA Mortgage
VA Home Loan Program Basics
The VA mortgage program enables eligible military personnel and veterans to buy a home with no down payment. Saving money to pay for a down payment is one of the biggest obstacles to buying a home so enabling borrowers to qualify for a home loan with no money down is a significant benefit. Although borrowers are required to pay an extra upfront VA funding fee, the VA home loan program makes home ownership more affordable and accessible to active and retired military members. Use our VA Mortgage Qualification Calculator to determine the VA funding fee based on your loan amount, type of military service and the number of times you have used the program.
VA Home Loan Program Qualification Guidelines
VA borrower mortgage qualification guidelines are slightly less flexible than other no or low down payment mortgage programs such as the FHA home loan program. The VA home loan program requires a minimum credit score of 620 as compared to 580 for the FHA program. Additionally, the VA home loan program uses a borrower debt-to-income ratio of approximately 41% to determine what size mortgage you qualify for as compared to a debt-to-income ratio of 43% or higher for the FHA mortgage program. Using a lower debt-to-income ratio means that borrowers qualify for a smaller mortgage amount. Our VA Mortgage Qualification Calculator applies this conservative debt-to-income ratio to calculate what size VA loan you can afford. Additionally, the VA home loan program applies a residual income requirement to ensure that borrowers have sufficient funds after paying their mortgage and total monthly housing expense.
VA Mortgage Rates are Lower
The mortgage rate for VA home loans is lower than the interest rate for many other no or low down payment home loan programs. VA home loans have lower interest rates because the mortgages are insured by the U.S. government and military personnel tend to be more financially responsible and credit-worthy. Paying a lower interest rate reduces your mortgage payment and total monthly housing expense and saves you thousands of dollars in total interest expense over the term of your mortgage. Use our VA Mortgage Qualification Calculator to understand how lower mortgage rates impact your monthly payment.
VA Home Loan Program Eligibility
The VA home loan program is available to all eligible military personnel. In general, you are eligible for the VA home loan program if you served on active duty for more than 90 consecutive days during wartime or more than 181 days during peacetime. National guard members and reservists are required to have served a minimum of six years. Additionally, unlike some other low or no down payment mortgage programs, the VA home loan program does not apply borrower income limits or restrict where the property being mortgaged is located. Although the program uses VA loan limits that cap your mortgage amount, not using income limits or property location restrictions makes the VA home loan program available to more eligible military members and veterans.
Your Mortgage Amount Can Be More than the VA Loan Limit
Like many other low down payment mortgage programs, the VA program applies loan limits. Unlike other programs, however, your mortgage amount can actually exceed the VA loan limit for your county. This may seem confusing and you may ask yourself how this is possible. According the VA program guidelines, your loan amount can be more than the loan limit as long as you make a down payment of at least 25% of the difference between your mortgage and the limit. For example, if the loan limit is $400,000 and you want a $500,000 loan, you would be required to make a $25,000 down payment ($500,000 (mortgage) - $400,000 (loan limit) = $100,000 (difference) x 25% = $25,000 (required down payment). Most people who use the VA Program put no money down so they are subject to the loan limits but it is helpful to understand that you may be able to qualify for a higher mortgage amount.
You Can Use the VA Program More Than Once
The VA Program can be used multiple times although you are typically required to pay off any current VA loans you have before you are eligible for a new one. In some cases, such as if you are transferred, you may not be required to pay off your current loan but this is relatively uncommon. Additionally, the VA funding fee is higher if you are not using the program for the first time but you are still eligible to buy a home with no down payment and take advantage of lower VA interest rates.
More FREEandCLEAR Mortgage Resources
Review our comprehensive overview of the VA home loan program including eligibility guidelines, borrower qualification requirements and other key program information such as the VA funding fee and VA loan limits
Understand the advantages and disadvantages of a VA home loan to determine if it the right program for you
Use our VA mortgage rate table to review updated VA rates and closing costs for lenders in your area. Shopping multiple lenders is the best way to save money on your VA home loan
Review and compare multiple government-backed and conventional low or no down payment mortgage programs to understand borrower benefits, program eligibility requirements and qualification guidelines
VA Mortgage Qualification: https://benefits.va.gov/HOMELOANS/purchaseco_eligibility.asp
VA Funding Fee: https://benefits.va.gov/homeloans/documents/docs/funding_fee_table.pdf
VA Mortgage Program: https://www.benefits.va.gov/homeloans/resources_veteran.asp