VA Loan Calculator – Payment with Funding Fee
Estimates your full monthly VA loan payment — principal & interest plus the VA funding fee, property tax, insurance and HOA — and compares the result side by side with an FHA loan. Enter the home price, rate, term, loan type and entitlement use.
Estimate Your Monthly VA Payment and the Savings over FHA
VA Loan Formula
Where:
- \(P\) — home price in dollars (for a refinance, the loan balance being refinanced)
- \(d\) — down payment as a percentage of the price (0% is allowed on VA purchase loans)
- \(B\) — base loan amount: price minus the down payment
- \(f\) — VA funding fee rate (%), set by your down payment, entitlement use and loan type
- \(L\) — total VA loan amount, base plus the fee when the fee is financed; if you are exempt or pay the fee in cash, \(L = B\) or the fee is 0
- \(r\) — monthly interest rate (APR ÷ 12)
- \(n\) — total number of monthly payments (term in years × 12)
- \(M\) — monthly principal & interest
The funding fee is a one-time charge, not a monthly cost. The calculator adds monthly property tax, homeowner's insurance and HOA dues to \(M\) to produce the total monthly payment.
VA Loan – Calculation Example
Example: a veteran using the entitlement for the first time buys a $400,000 home with $0 down at 6.5% APR for 30 years, is not exempt from the funding fee, and finances the 2.15% first-use fee into the loan.
\[ \text{fee} = 400{,}000 \times 0.0215 = 8{,}600 \]
\[ L = 400{,}000 + 8{,}600 = 408{,}600 \]
\[ M = 408{,}600 \cdot \frac{0.00541667\,(1.00541667)^{360}}{(1.00541667)^{360} - 1} \approx 2{,}582.64 \]
Result: a funding fee of $8,600, a total VA loan amount of $408,600, and monthly principal & interest of about $2,582.64. With property tax of $366.67/mo (1.1% of the price) and homeowner's insurance of $125/mo, the total monthly payment is roughly $3,074.31, and total interest over 30 years is about $521,150. On the same home an FHA loan would cost about $77 more per month and require $14,000 down instead of $0.
How to use the calculator
- Enter the Home price. For an IRRRL, enter the loan balance being refinanced instead of a purchase price.
- Set the Down payment — 0% is fine on a purchase; the amount you put down determines which funding fee rate applies.
- Fill in the Interest rate (APR) and choose a Loan term of 15 or 30 years.
- Choose the Loan type: Purchase, Cash-out refinance, or IRRRL (streamline refinance).
- Select VA entitlement use — First use or Subsequent use. Subsequent use with less than 5% down carries a much higher fee (3.3%).
- Tick Exempt from funding fee if you have a 10%+ disability rating, received a Purple Heart, or are an eligible surviving spouse — the fee then drops to zero.
- Leave Finance the funding fee checked to roll the fee into the loan, or uncheck it to pay the fee in cash at closing.
- Adjust the VA Funding Fee Rates fields if the VA changes its schedule — only the rates relevant to your loan type and entitlement use are shown.
- Enter the Property tax rate, Homeowner's insurance premium and any HOA dues so the result reflects the full monthly payment.
What a VA loan is and how the funding fee works
A VA loan is a mortgage guaranteed by the U.S. Department of Veterans Affairs and offered by private lenders to eligible veterans, service members and surviving spouses. Its two headline benefits are that no down payment is required and that no monthly mortgage insurance is charged regardless of how little you put down. FHA and low-down-payment conventional loans, by contrast, add a monthly insurance premium that can add hundreds of dollars to the payment.
In exchange, the VA charges a one-time funding fee at closing. The fee funds the program so the guarantee costs taxpayers nothing, and its rate depends on three things: your down payment (bigger down payments mean lower rates), whether it is your first or subsequent use of the entitlement, and the loan type. A first-time purchase with 0% down currently costs 2.15% of the base loan, subsequent use with less than 5% down costs 3.3%, and an IRRRL streamline refinance costs a flat 0.5%. Most borrowers finance the fee into the loan, which slightly increases the balance and the monthly payment.
Some borrowers pay no fee at all: veterans with a VA disability rating of 10% or higher, Purple Heart recipients, and eligible surviving spouses are exempt. If you are unsure about your rating, the VA disability rating calculator can help you estimate combined ratings from multiple conditions. If you paid a fee and later receive a qualifying rating that is retroactive to before the loan closed, the VA will refund it.
The results table splits your costs the way a lender's estimate does: the funding fee itself, the total loan amount with the fee financed, and monthly principal & interest, plus taxes, insurance and HOA as an escrow-style add-on. The side-by-side FHA comparison, estimated with the same rate and term in our FHA loan calculator, shows the monthly mortgage premium you avoid — typically the single biggest reason the VA payment comes out lower.
VA funding fee reference rates
| Loan type and entitlement use | <5% down | 5–9.99% down | 10%+ down |
|---|---|---|---|
| Purchase, first use | 2.15% | 1.5% | 1.25% |
| Purchase, subsequent use | 3.3% | 1.5% | 1.25% |
| Cash-out refinance, first use | 2.15% (flat) | — | — |
| Cash-out refinance, subsequent use | 3.3% (flat) | — | — |
| IRRRL (streamline), any use | 0.5% (flat) | — | — |
These are the rates preloaded in the calculator; the VA adjusts them periodically, so verify the current schedule before you lock a loan.
Assumptions and practical tips
- Rates and figures are estimates. The interest rate, tax rate, insurance premium and HOA dues are simplified inputs; your lender's quote and local tax bill control the real numbers. For a better tax estimate, use our property tax calculator.
- Closing costs are not included. VA loans limit what the veteran can pay in fees, but appraisal, title and lender charges still exist at closing — budget for them separately with the closing costs calculator.
- A larger down payment cuts the fee twice. Putting 5% down drops the first-use rate from 2.15% to 1.5%, and 10% down drops it to 1.25% — while also shrinking the balance itself.
- Paying the fee in cash vs. financing it. Financing preserves your cash but you pay interest on the fee for the life of the loan; at 6.5% over 30 years, a financed $8,600 fee adds roughly $56/mo.
- The FHA comparison assumes the same interest rate for both loans, a 3.5% minimum FHA down payment, a financed 1.75% upfront MIP and a typical annual MIP. In practice FHA rates often differ from VA rates, so treat the comparison as a rough benchmark, especially for an IRRRL.
- Full entitlement assumed. With full entitlement there is no VA loan limit regardless of home price; borrowers with reduced or bonus entitlement should confirm their remaining entitlement with a lender.
- The monthly payment is not the whole cost picture. Compare total interest over the term too, and remember that stronger repayment habits — modeled in the mortgage payoff calculator — can cut a VA loan's interest dramatically.
Frequently Asked Questions
How do I calculate a VA loan payment by hand?
Take the base loan amount (price minus down payment), add the funding fee if you finance it, then apply the standard amortization formula: \(M = L \cdot \frac{r(1+r)^n}{(1+r)^n - 1}\), where \(r\) is the annual rate divided by 12 and \(n\) is the term in months. For a 30-year loan at 6.5%, \(r \approx 0.0054167\) and \(n = 360\). Finally, add monthly property tax, insurance and HOA dues to get the total payment.
Who is exempt from the VA funding fee?
Veterans with a VA disability rating of 10% or higher, Purple Heart recipients, and eligible surviving spouses of veterans who died in service or from a service-connected disability pay no funding fee at all. Active-duty service members and veterans without a qualifying rating must pay it. If you receive a retroactive rating dated before your loan closing, you can apply to the VA for a refund of the fee you paid.
Is the funding fee paid monthly or one time?
It is a one-time charge paid at closing — never a recurring cost. You can either bring cash to closing or roll it into the loan balance. Financing it spreads the cost over the term with interest: an $8,600 fee financed at 6.5% over 30 years adds roughly $56 to the monthly payment, versus $8,600 upfront in cash.
Is a 3.3% funding fee charged on every VA loan?
No. The 3.3% rate applies only to a subsequent use purchase loan with less than 5% down. First-time purchase loans cost 2.15% with less than 5% down, 1.5% at 5–9.99% down, and 1.25% at 10% or more down. Cash-out refinances use the same first-use/subsequent-use rates with no down-payment tiers, and an IRRRL streamline refinance charges a flat 0.5%.
Does a VA loan have a loan limit or required down payment?
With full entitlement, there is no loan limit and 0% down is allowed at any price — the lender just requires that the home appraise. Borrowers with reduced or bonus entitlement (for example, when a previous VA loan is still in repayment) may need a down payment to cover the entitlement gap, typically 25% of the amount above their available entitlement. Confirm your remaining entitlement with your lender.
Why is my VA payment higher than an FHA payment in some cases?
VA payments beat FHA on most purchases because FHA adds both a financed 1.75% upfront premium and a monthly mortgage insurance premium. But the comparison can flip for large loans or when the funding fee is high — for instance, subsequent use at 3.3% with the fee financed — or when a borrower puts substantial money down on FHA. The calculator compares both at the same rate and term; real-world rates differ, so verify with actual lender quotes.
Does the calculator include closing costs and the VA escrow deposit?
No. The results cover the funding fee, principal & interest, taxes, insurance and HOA only. VA loans allow sellers and lenders to cover many charges, but you still pay an appraisal, recording fees and possibly a VA escrow deposit for taxes and insurance at closing. Budget those separately — typically 2–5% of the price unless the seller concedes — so you are not surprised at the closing table.