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Calculating VA Loan Monthly Payments: What You Need To Know

Last updated: May 8, 2023

Military spouses, service members, and veterans with valid Certificates of Eligibility (COE) are eligible for VA loans. With VA loans, you don't have to put any money down, you don't have to pay private mortgage insurance (PMI), and you typically pay a lower interest rate than other loans.

Several factors influence interest rates, including credit score. You can estimate your VA loan payment by estimating your credit score. Lenders, locations, loan types, and loan amounts can greatly influence home loan and mortgage offerings. To get familiar with multiple loan providers' terms, options, and requirements, it is a good idea to research them.

What Is A VA Loan Calculator?

It's a good idea to start with a VA loan calculator if you want to maximize the benefits of your VA loan. Using a VA loan calculator can help you learn about the potential financial impact of VA loans, as well as help you find the right lender.

Veteran and active-duty service members, reservists, and members of the National Guard are eligible for Veterans Affairs mortgages. A VA loan calculator helps calculate an accurate VA mortgage loan payment by accounting for appropriate VA funding fees, down payments, property taxes, and homeowner's insurance.

VA Loan Calculator VS. Broad Mortgage Calculator

VA Loan Calculator VS. Broad Mortgage Calculator

There are some differences between VA loans and other mortgage options when calculating monthly payments. The VA funding fee, VA disability rating, prior VA loan use, and the type of loan is among the factors that affect the accuracy of the VA loan payment. You can estimate your loan purchasing power more accurately using a VA loan calculator that considers these factors.

How To Use The VA Loan Calculator

The VA loan calculator can help you determine how much you can borrow or refinance your house, depending on your unique situation. Each time you change the fields in the calculator, you'll see an updated estimate of your VA loan payment. You can alter the estimates of property taxes and insurance under the "Advanced Settings" section. It is typical to have a 1.2% and 0.35% estimate. However, your estimates may vary depending on your location.

VA Loan Calculator Inputs Defined

Let’s look closer into the VA loan calculator inputs:

Home Value

An individual's home value is their potential purchase price, excluding the amount they will need to put down on the house.

Down Payment

Down payments are payments made in advance toward the principal amount of the loan. VA borrowers are not required to make a down payment, and most choose to make no down payment. If you decide to put down money, though, it may reduce your monthly payments and the VA funding fee (if required).

Interest Rate

The interest rate represents borrowing costs. Calculators include APRs, which amount to the cost of borrowing based on closing costs and fees. There is no guarantee that the interest rate in the calculator will match your interest rate, as the rates are presented for calculating purposes only. Click here to view current VA mortgage rates.

Loan Term

How long do you plan to repay the loan? The loan term determines this duration. In other words, the loan term indicates how long you want to borrow the money. Typically, VA loans have durations that last between 15 and 30 years.

Credit Score

Based on information from your credit reports, a credit score predicts your credit behavior, such as whether or not you will be able to repay a loan on time. A high score increases your chances of getting approved for a loan and will usually result in a better interest rate. An average credit score is between 300 and 850.

You must have a good credit score to qualify for a VA loan. If your credit score is low, you will pay a higher interest rate and have a larger monthly payment. You can use Vantage Score to find your credit score if you don't know it yet.

Loan Type

The VA offers loans for both home purchases and refinances. As a result of the VA funding fee, loan types have different calculations. Different VA refinance calculators also offer cash-out and Interest Rate Reduction Refinance Loan (IRRRL) calculation options specific to VA refinancing.

VA Specifics

Funding fees for VA projects are subject to VA specifics. Survivors of VA buyers, those who have received a Purple Heart, and those with a disability rating over 10% are exempt from the VA funding fee. The VA funding fee is slightly higher for borrowers who have not been exempt and have previously used a VA loan.

VA Funding Fee

To keep the VA loan program running for years, the government pays the Department of Veterans Affairs a funding fee. There are several levels of VA funding fees, ranging from .5% to 3.6%, and not all borrowers are subject to them. The average VA funding fee is 2.3%.

Amortization Schedule

The amortization schedule shows how much is paid towards the principal balance of the loan and how much will be paid each month. If there are any additional amounts due at settlement, this figure includes them. You can calculate your monthly VA mortgage payments by looking at an amortization schedule for a VA loan. Additionally, amortization tables usually break down the number of principal amounts and interest that have to be paid over time.

The calculator lets you view your VA loan amortization schedule by clicking the tab marked "Amortization Schedule."

How Much VA Loan Can You Afford?

VA Loan Calculator

Your income and monthly expenses will determine how much you can afford to pay each month for your mortgage. Several lenders recommend that your monthly mortgage payment not exceed 28% of your gross income (including taxes and insurance).

Suppose you have a $10,000 down payment on a home that costs $210,000. With a 30-year term and 4% interest rate, you need a VA mortgage of $200,000. Approximately $4,600 is the VA Loan funding fee for a loan. The total amount you'll have to borrow will be $204,600 if you don't pay it upfront.

Approximately $955 would be your monthly mortgage payment. The monthly payment would be about $977 if the VA Loan funding fee is not paid upfront and rolled into payments, so you would need an annual gross income of about $41,871 or a monthly gross income of $3,489.

A guideline of 28% should only be considered as a starting point. It is possible to make large loan amounts more affordable by lowering interest rates. To determine what is financially comfortable for you, determine your current expenses and overall financial situation.

The VA Loan Process

To learn more about the VA loan process, you'll need to utilize the VA loan calculator once you've assessed what you can afford based on your military service and are ready to leverage the VA loan benefit.

VA Loan Process Steps

  1. Obtain your Certificate of Eligibility (COE)
  2. Find a lender who offers VA home loans
  3. Search for a house
  4. Process VA loans
  5. Complete your VA loan application

Applying for cash benefits from Social Security can seem overwhelming for some people. Check out our guide on how to increase your VA disability rating. To help you prepare for VA disability claims, make sure you do your research as well.

If you're a veteran and you're waiting for your convalescent pay, visit our article about how long it takes to receive VA convalescent pay to learn more.

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Cheri Hermanson
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