VA loan guide, in plain English
$0 down. No PMI. Use it again and again.
- Who: service members with 90 continuous days, most veterans, many Guard/Reserve, some surviving spouses.
- Cost: a one-time funding fee (2.15% first use, $0 down). Waived with a VA disability rating.
- Catch: you must live in it when you buy. You can rent it out after you move.
1. Are you eligible?
- On active duty: 90 continuous days of service.
- Veterans (Aug 2, 1990 to now): 24 continuous months, or the full period you were ordered to (at least 90 days), or less with a service-connected disability discharge.
- Guard: 90 days of non-training Title 10 duty, or 90 days including 30 consecutive under certain Title 32 orders, or 6 creditable years.
- Reserve: 90 days of non-training active duty, or 6 creditable years in the Selected Reserve.
- Surviving spouses: if you receive or are eligible for certain DIC, or your spouse is MIA/POW.
2. Get your COE
Your Certificate of Eligibility proves you qualify. Get it free on VA.gov, or your lender can pull it in minutes. Active duty usually needs a statement of service signed by your command.
3. The funding fee
| Down payment | First use | After first use |
|---|---|---|
| Less than 5% | 2.15% | 3.3% |
| 5% or more | 1.5% | 1.5% |
| 10% or more | 1.25% | 1.25% |
Purchase loans, effective April 7, 2023, same for active duty, veterans, Guard and Reserve. IRRRL refinance: 0.5%. Cash-out refinance: 2.15% first use, 3.3% after. Source: VA.gov, checked Oct 17, 2026.
No funding fee if you…
- get VA disability compensation (or are eligible but get retirement or active-duty pay instead),
- have a proposed or memorandum rating before closing (pre-discharge claim),
- are a surviving spouse receiving DIC, or
- are on active duty and show proof of a Purple Heart by closing.
You can finance the fee into the loan. If a disability rating is later made retroactive to before closing, ask the VA for a refund.
4. No PMI, no down payment
VA loans don't charge monthly mortgage insurance. With full entitlement there's no VA loan limit; your lender decides how much you can borrow. VA has no minimum credit score, but most lenders want about 620+.
Sellers can pay your closing costs. VA caps “concessions” at 4% of the home's value, but normal closing costs paid by the seller don't count toward that cap. Only the funding fee can be rolled into a purchase loan.
5. Can you afford it? (VA's two checks)
Debt-to-income: VA's guideline is 41% of gross income (BAH counts). Higher can still work with strong residual income.
Residual income: money left each month after the house payment, taxes, debts and estimated upkeep.
| Family size | Northeast | Midwest | South | West |
|---|---|---|---|---|
| 1 | $450 | $441 | $441 | $491 |
| 2 | $755 | $738 | $738 | $823 |
| 3 | $909 | $889 | $889 | $990 |
| 4 | $1,025 | $1,003 | $1,003 | $1,117 |
| 5 | $1,062 | $1,039 | $1,039 | $1,158 |
Monthly residual income guideline for loans of $80,000+. Over 5 people: add $80 each. Source: VA Lenders Handbook (Pamphlet 26-7), chapter 4.
Regions: Northeast = CT, ME, MA, NH, NJ, NY, PA, RI, VT. Midwest = IL, IN, IA, KS, MI, MN, MO, NE, ND, OH, SD, WI. South = AL, AR, DE, DC, FL, GA, KY, LA, MD, MS, NC, OK, PR, SC, TN, TX, VA, WV. West = AK, AZ, CA, CO, HI, ID, MT, NV, NM, OR, UT, WA, WY.
6. Entitlement, explained
Entitlement is the VA's promise to your lender: it covers 25% of the loan. Full entitlement (never used, or restored) means no VA loan limit.
Still own a home with a VA loan? You may have remaining entitlement. VA's math: (2026 county one-unit limit × 25%) − entitlement already used. Multiply what's left by 4 for the most you can borrow with $0 down. Need more? Put down 25% of the difference.
Example from VA: limit $900,000 × 25% = $225,000; minus $50,000 used = $175,000 left; × 4 = $700,000 with $0 down.
7. Using it again
- Sold the home and paid off the loan: restore your full entitlement.
- Paid it off but kept the home: one-time restoration.
- Still have the loan: use remaining entitlement (above). Your funding fee is 3.3% with under 5% down.
8. Renting it out after you PCS
VA requires you to occupy the home as your primary residence when you buy (usually within 60 days; a spouse can satisfy it if you're deployed). After that, you can move and rent it out. Run the numbers first:
- Rent covers the payment, plus 8–10% for a property manager
- A month or so of vacancy each year
- Repairs, about 1% of the home's value a year
- Landlord insurance (it replaces homeowners insurance)
- Taxes on rental income, and depreciation (ask a tax pro)
9. House hacking
A VA loan can buy a home with up to 4 units if you live in one. Tenants in the other units help pay the mortgage. Lenders may count part of that rent as income and may want cash reserves. 2026 FHFA limits for 2–4 units matter only if you have partial entitlement.
FAQ
What is the VA funding fee in 2026?
For a purchase: 2.15% with less than 5% down on first use, 3.3% after first use, 1.5% with 5%+ down, 1.25% with 10%+ down. These rates have applied since April 7, 2023.
Who doesn't pay the VA funding fee?
Anyone receiving (or eligible for) VA disability compensation, surviving spouses receiving DIC, service members with a pre-discharge rating before closing, and active-duty Purple Heart recipients.
Is there a VA loan limit?
Not with full entitlement. With remaining (partial) entitlement, VA uses the county's FHFA one-unit limit to work out how much you can borrow with $0 down.
Can I use a VA loan twice?
Yes. Restore entitlement after you sell and pay off the loan, or use remaining entitlement while you still own the first home.
Can I buy a duplex or fourplex with a VA loan?
Yes, up to 4 units, if you live in one of them.
Do Guard and Reserve members qualify?
Yes, with 6 creditable years, or 90 days of qualifying active-duty service.
Does a VA loan need PMI?
No. VA loans don't have monthly mortgage insurance.
Sources
- DTMO: 2026 BAH rates (ASCII download, incl. TX270 update eff. May 16, 2026) — effective Jan 1, 2026
- HUD: FY2026 Fair Market Rents — 40th-percentile gross rent incl. utilities, effective Oct 1, 2025
- Zillow Research: ZHVI and ZORI (county) — Sept 2026
- Freddie Mac: Primary Mortgage Market Survey — 30-yr fixed 7.4%, week of 2026-10-15
- U.S. Census: ACS 2020-2024 5-year, tables B25103 and B25077 — property tax ÷ home value
- FHFA: 2026 conforming loan limits
- VA: funding fee and closing costs — rates effective April 7, 2023
- VA: entitlement and loan limits
- VA: eligibility
- VA Lenders Handbook (Pamphlet 26-7), ch. 4: residual income
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