Quick comparison
| Typical down payment | $0 for eligible borrowers |
|---|---|
| Monthly mortgage insurance | None (no PMI/MIP) |
| Main extra cost | One-time VA funding fee |
| Best fit | Eligible veterans & service members |
| Underwriting focus | Residual income + COE |
Why VA loans have no PMI
VA loans are guaranteed by the U.S. Department of Veterans Affairs, so lenders do not require private mortgage insurance even with no down payment. Instead, most borrowers pay a one-time VA funding fee, which can often be rolled into the loan. That structure typically makes the monthly payment lower than a comparable conventional loan with PMI or an FHA loan with monthly MIP — especially valuable when preserving cash after move-in.
Who qualifies for a VA loan
Eligible active-duty service members, veterans, and certain surviving spouses can use VA loan benefits, often more than once if entitlement remains. Lenders still underwrite residual income, credit, and the property’s VA appraisal requirements. Because there is no down payment requirement and no monthly mortgage insurance, remember to budget for the funding fee (unless exempt) and normal closing costs.
How this calculator models the funding fee
Choose first-use vs subsequent use and enter any voluntary down payment. The tool applies common purchase funding-fee percentage tiers (and a 0% rate when you mark a disability exemption), then optionally finances the fee into the loan balance before calculating principal and interest. Percentages are illustrative — confirm the current VA schedule and your COE status with a VA-experienced lender.
When a down payment still helps
Even though VA allows $0 down, a voluntary down payment can reduce the loan amount, move you into a lower funding-fee tier in some cases, and improve offer strength in competitive markets. Run the calculator at $0 down and again with 5–10% down before you decide how much cash to bring to closing.
Checklist before you apply
- Obtain your Certificate of Eligibility (COE) early.
- Ask whether you are exempt from the funding fee (e.g., certain disability ratings).
- Confirm remaining entitlement if you already used a VA loan.
- Budget closing costs separately — $0 down does not mean $0 cash to close.
- Compare a VA quote to a conventional 5–20% down scenario if you have cash available.
For the formulas behind every estimate, see how we calculate. Worked example: VA entitlement and residual income.