VA Loan Calculator
Estimate your VA mortgage costs with funding fee calculations. Compare VA vs conventional loans to see your savings with no PMI and no down payment.
VA loans require no PMI and no down payment, saving eligible veterans and service members thousands over the life of their loan. The VA funding fee is a one-time cost that can be financed into the loan, and it is waived entirely for veterans with service-connected disabilities.
Understanding VA Loans
VA loans are mortgages guaranteed by the U.S. Department of Veterans Affairs, available to eligible active-duty service members, veterans, and surviving spouses. The VA does not lend money directly -- instead, it guarantees a portion of the loan, which allows VA-approved lenders to offer more favorable terms. Eligibility is determined by your service history and documented through a Certificate of Eligibility (COE).
The biggest advantages of VA loans are zero down payment and no private mortgage insurance (PMI). On a conventional loan, putting less than 20% down requires PMI, which can add $100-$400 per month depending on loan size and credit score. VA loans eliminate this cost entirely, which can save borrowers $30,000 to $60,000 over the life of a 30-year mortgage. VA loans also tend to have lower interest rates than conventional loans -- typically 0.25% to 0.5% lower -- because the government guarantee reduces lender risk.
The VA funding fee is a one-time charge that helps fund the VA loan program. For first-time use with zero down, the fee is 2.15% of the loan amount. This decreases to 1.5% with 5-9.99% down, and 1.25% with 10% or more down. Subsequent use with zero down carries a higher fee of 3.3%. The funding fee can be paid at closing or financed into the loan. Veterans with service-connected disabilities are exempt from the funding fee entirely, making the VA loan even more beneficial.
VA loans beat conventional in most scenarios for eligible borrowers. Even accounting for the funding fee, the absence of PMI and lower interest rates typically result in lower total costs over the life of the loan. The main scenario where conventional might be preferable is if you have 20% down and excellent credit -- in that case, there is no PMI on the conventional side, and you avoid the VA funding fee. But for most veterans, especially those with less than 20% to put down, the VA loan is the clear winner.
The disability exemption is particularly valuable. Veterans receiving VA disability compensation -- even at the 10% level -- pay zero funding fee. On a $350,000 loan, that saves $7,525 upfront (first use) or $11,550 (subsequent use with zero down). If you have any service-connected disability rating, make sure to provide your COE showing exempt status when applying for your VA loan.