Use our VA mortgage calculator to quickly estimate your monthly payment for a VA Purchase or VA Refinance Loan. Most active-duty military and veterans qualify for no money down Veterans Affairs mortgages, and many reservists and National Guard members are eligible.
VA Loan Calculator
Why Should I Use The VA Mortgage Calculator?
Why should you use a VA home loan calculator? The simplest answer is that you will want an estimate of your monthly mortgage payments before you commit to the purchase of property.
That sounds fairly simple, but what isn’t so obvious are the things that go into that calculation. Some VA loan applicants, especially those who are new to buying a home, tend to overlook some crucial details when trying to calculate the monthly VA mortgage payment.
Using an online VA loan calculator eliminates this problem as you will be required to enter all the specifics to arrive at your estimate–you won’t be able to overlook or forget key data.
In addition to what is mentioned above, the most important reason to use an online mortgage loan calculator to estimate your VA home loan payments has a lot to do with determining your ability to afford the loan.
Buying a home is a complex process and there are up-front fees, costs that are paid by the seller (should you choose to negotiate to do that), and there are charges that are issued by the VA intended to offset the taxpayer burden of the VA loan program.
The problem is, not all VA borrowers are required to pay the same costs and not all the costs associated with your loan may affect your mortgage payment. But sometimes they do. What does this mean?
A veteran with a VA-rated disability may be exempt from having to pay the VA loan funding fee, for example. But a veteran who does not have the option to apply for an exemption from the VA loan funding fee can either pay that fee up front in cash or include that amount in the loan (assuming the participating lender permits this–VA loan rules do, but the lender is not obligated to do so).
By including the funding fee into the loan amount, the borrower will have to calculate monthly mortgage payments based on the higher loan amount due to rolling the funding fee into the mortgage.
This choice can be a crucial one for some borrowers because you must either pay the entire funding fee up front in cash OR finance the entire funding fee. No partial payments are allowed and that’s an important consideration for those who need to save as much up front and out of pocket on the mortgage loan as possible.
And there are other variables including whether you choose a 15-year or 30-year loan term, and whether or not you choose to make a down payment.
How To Use The VA Loan Calculator
To use the mortgage calculator you will need to prepare a bit. The first thing you’ll need is an actual or hypothetical house sale price. If you have not started house hunting yet, you can estimate what you think you can afford and make adjustments from there. Once you have a sale price, you will also need the following details, which you enter into the appropriate field on the online VA mortgage calculator:
- Funding Fee
- Down Payment
- Loan Length
- Interest Rate
- Property Tax
- Homeowners Insurance
- HOA Dues
Things You Should Know
The amount of your VA loan funding fee will vary (see below) depending on whether you are a first-time VA loan applicant, a second-time borrower, whether you receive or are eligible to receive VA compensation for service-connected disabilities. Your participating VA loan officer can help you arrive at an amount for the VA loan funding fee if you aren’t sure what fee structure applies to you.
The Loan Term Is Important
The loan length for VA mortgages, according to the VA Lender’s Handbook, is either 15 or 30 years. The same is true for VA refinance loans. Homeowner’s insurance will affect the amount of money you spend on your mortgage each month, but keep in mind that homeowner’s insurance and mortgage insurance (which is not required by VA loan rules) are two different things.
Interest Rates
The interest rate issue can be a tricky one. Borrowers with excellent credit have fewer questions or concerns in this area than those who may have experienced credit trouble in their past and are worried about their ability to qualify for the mortgage.
Interest rates should always be calculated conservatively–it doesn’t pay to be overly ambitious with a low interest rate, especially in times where rates are subject to more volatility than usual. You can always call a participating VA lender to ask what the going interest rate on a 15-year or 30-year VA mortgage loan is with a specific FICO score range.
Mortgage Calculators For VA Refinance Loans
You can also use a mortgage calculator to estimate your monthly mortgage payment for a VA loan refinance option, but the questions you’ll need to answer in this area are a bit more complex.
Do you need to estimate the payment on a VA Cash-Out refinance loan? Or a Streamline Refinance? What about a VA no-cash-out refinance option? The costs of these loans will vary depending on the duration, whether or not you are getting cash out, or if you need to refinance an existing VA mortgage with a Streamline Refi.
How Are VA Mortgage Payments Calculated?
VA mortgage payments are calculated by adding all the monthly expenses associated with your mortgage loan together including interest and dividing by the number of payments required.
But some borrowers forget that this is not a simple matter of adding taking your principal balance, calculating the interest, and dividing by the loan term. The following variables will all need to be included in your VA mortgage payment calculation:
- Principal balance
- Interest rate
- Loan term
- Property taxes
- Any add-ons to the loan such as the VA loan funding fee, Energy-Efficient Mortgage funds, etc.
- Any applicable Homeowners Association or Condo Owners Association fees
- Any applicable insurance
VA Loan Funding Fee
The VA funding fee is described on the VA official site as “a one-time payment that the Veteran, service member, or survivor pays on a VA-backed or VA direct home loan” designed to offset the cost of the VA loan program for taxpayers.
Who pays the VA loan funding fee? Anyone who needs to use a VA mortgage to buy, build, refinance, improve, or repair a home. The VA loan funding fee is not applicable to the following people who are:
- Receiving VA compensation for a service-connected disability;
- Eligible to receive VA compensation for a service-connected disability;
- The surviving spouse of a Veteran who died in service or from a service-connected disability, or who was totally disabled, (the spouse must be receiving Dependency and Indemnity Compensation or qualify for it);
- A service member with a proposed or memorandum rating, before the loan closing date, saying you’re eligible to get compensation because of a pre-discharge claim;
- Those who were awarded the Purple Heart before or on the loan closing date and have evidence to provide the lender.
The VA loan funding fee is charged at a lower amount for first-time use and a higher amount for second-time use. The VA loan funding fee amount you are charged is lowered incrementally for those who choose to make a down payment on their VA home loan. The VA loan funding fee is calculated as a percentage of the total loan amount as follows:
- For first-time VA loan use with 5% or less down, the VA loan funding fee is 2.3%
- For first time use with more than 5% down, the VA loan funding fee is 1.65%
- For first-time use with 10% or more down, the funding fee is 1.4%
- For second-time use, 5% or less down, 3.6%
- For second-time use with 5% or more down, 1.65%
- For second-time use with 10% or more down, 1.4%
These rates apply to active duty, Guard, and reserve applicants.
VA Loan Benefits
There are many benefits to using a VA home loan over a conventional mortgage or even some government-backed mortgage programs such as the USDA or FHA single-family home loans. One advantage is the lack of a minimum required down payment. USDA loans also feature zero-down borrowing, but these loans are need-based and feature household income restrictions VA mortgages do not impose.
VA home loans can be refinanced with no VA-required credit check or appraisal if the borrower is using a VA Streamline Refinance (also known as a VA Interest Rate Reduction Refinance Loan or VA IRRRL).
Streamline Refinance loans generally must deliver some tangible benefit to the borrower in the form or a lower monthly payment, a lower interest rate, getting out of an adjustable rate loan and into a fixed-rate VA mortgage, etc.
This VA refinance option is NOT open to those with non-VA mortgages.
Other advantages of VA home loans include the VA loan program’s comparatively lower credit qualifying requirements. Compared to many conventional loans, the perks of the VA mortgage program–which include no VA-required mortgage insurance premiums as well as no money down make the VA mortgage loan option a very important one for veterans and currently serving military members alike.
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Joe Wallace is a 13-year veteran of the United States Air Force and a former reporter for Air Force Television News
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