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What does this calculator estimate?
Free VA mortgage calculator: monthly payment with the 2026 VA funding fee included, zero PMI. Compare first-use, down-payment and IRRRL scenarios instantly.
VA funding fee versus PMI: how the comparison actually plays out
The funding fee is the VA loan's version of mortgage insurance, and the calculator treats it the same way: as a one-time cost added to the loan balance rather than a monthly line item. For a first-time VA borrower putting zero down, the fee is 2.15% of the loan amount; with a 5% down payment it drops to 1.5%. On a $300,000 purchase that is $6,450 versus $4,500, and because it is financed, it also generates interest for the life of the loan. A conventional 5%-down loan usually charges PMI of roughly 0.4% to 1.2% of the balance per year, which on the same house is $1,200 to $2,400 annually until 20% equity is reached.
Run the two against each other and the VA loan wins on total cost in almost every case under 10 years of ownership, and often stays ahead after that. Where the comparison gets interesting is a large down payment: at 20% down a conventional borrower pays no PMI at all, while a VA borrower still owes a funding fee of 1.25% (first use). That is the one scenario where financing through a VA loan can cost more, and this calculator will not flag it for you. Enter the numbers both ways and read the totals.
Entitlement, the conforming loan limit, and buying above your entitlement
Since 2020 there is no statutory VA loan limit for borrowers with full entitlement, but entitlement itself is finite. Full entitlement covers a loan of up to roughly $806,500 in most counties (the 2025 conforming limit), and if you default, the VA repays the lender up to 25% of that amount. Borrowers who have a VA loan outstanding, or who lost a prior home to foreclosure with a VA loan, have partial entitlement. In high-cost counties your maximum zero-down amount shrinks to 25% of the difference between entitlement used and the local county limit.
Practically, this means the same calculator inputs describe two different situations. If you have full entitlement, the payment is exactly the principal-and-interest number plus taxes, insurance, and the financed funding fee. With partial entitlement, a lender may require a down payment to keep the loan within guaranteed bounds, and the calculator has no field for that.Down payment shifts the loan amount manually: subtract it from the price and the funded fee recalculates on the smaller balance only if you enter the loan amount directly. If your entitlement is partial, ask your lender for the eligible loan amount before trusting the monthly figure.
What the seller can pay for: the negotiated costs this estimate leaves out
VA appraisers enforce minimum property requirements, but the bigger negotiation lever is the seller concession rule: a seller may pay up to 4% of the purchase price toward the buyer's closing costs, prepaids, and even the VA funding fee. On a $300,000 contract that is $12,000, which typically covers lender fees, title, escrow deposits, and anything left over can knock the fee down or off. Conventional loans usually cap seller-paid costs at 3% to 9% depending on down payment and occupancy, so VA buyers often negotiate a higher share of closing charges.
This calculator does not model concessions, and it should not, because they are a negotiation outcome rather than a rate of the loan. Instead, use the monthly figure as your all-in fixed cost and keep a separate line for one-time cash to close. A realistic sequence when comparing two houses: take the VA payment for each, then subtract your real expected closing costs, then decide. A house $10,000 cheaper can still be the more expensive purchase if its seller refuses concessions while the other one pays the full 4%.
Refinancing a VA loan with an IRRRL: what the numbers look like
Existing VA borrowers have a shortcut called an Interest Rate Reduction Refinance Loan, often a streamline refinance. No appraisal is required in most cases, no income documentation in many, and the funding fee is 0.5% instead of 2.15% or 1.5%. The tradeoffs: the rate has to be lower than the existing one (or the term shorter), and the lender has to show that the refinance pays for itself. Congress added a 36-month recoupment rule in 2018, meaning total closing costs divided by the monthly savings must be recovered within 36 payments or the loan fails to qualify.
That recoupment test is exactly the kind of math to run here before calling anyone. Suppose your rate drops from 6.75% to 5.50% on a $280,000 balance: that cuts roughly $185 a month. If total costs are $4,400, the payback is 23.8 months, comfortably inside 36 and worth doing. If costs run $8,000, payback stretches to 43 months and a mainstream lender is unlikely to accept the file.Before you sign a streamline offer, ask what the new loan balance is: fees financed rather than paid in cash raise the principal, and that larger balance is the number your payment sits on for the rest of the term.
How this calculator works
Assumptions to verify
- The VA funding fee is added to the loan when you select that option. Buyers who qualify for the disability exemption pay no funding fee.
- VA loans carry no monthly mortgage insurance, which is the main cost difference against a conventional loan at the same rate.
- The residual-income test, which varies by region and household size, is not modelled; it can reject a borrower that the debt-to-income ratio passes.
- Property tax and homeowners insurance are excluded from the payment unless entered separately.
Cite this tool
BoringToolsKit. “VA Mortgage Calculator.” boringtoolskit.com/va-mortgage-calculator/. Free to reference in articles, syllabi, and answer posts with a link.
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$300k VA loan, 6.5%
What this means for your numbers: The funding fee adds $6,450 to the worked example's loan: $0 monthly mortgage insurance is the trade. No-fee eligibility (service-connected disability) removes it entirely.
Illustrative breakdown using the worked example above. The calculator computes your own numbers with the same formula.
A worked example: $300,000 at 6.25% with the 2.15% funding fee
Take a first-time VA buyer using zero down on a $300,000 purchase. The funding fee preset fills 2.15%, so the financed amount is 300,000 x 1.0215 = $306,450. The monthly rate is 6.25% / 12 = 0.5208333%, and the standard annuity formula, payment = loan x r / (1 - (1 + r)^-360), gives 306,450 x 0.0052083333 / (1 - 1.0052083333^-360). Since 1.0052083333^360 is about 6.4885, the denominator is 1 - 0.154119 = 0.845881, and the payment works out to 1,596.09 / 0.845881 = $1,886.87 per month.
Total of payments is 1,886.87 x 360 = $679,273, so total interest is $679,273 - $306,450 = about $372,822. Two comparisons show why the fee and the VA guarantee matter. Drop the fee to 0% (2.15% is avoided for veterans with a qualifying service-connected disability) and the same loan runs $1,847.15 per month, $39.72 less, saving roughly $14,300 over 30 years. With a conventional loan instead, the same $306,450 at 6.25% plus typical PMI of 0.5% to 1.5% of the balance per year adds roughly $128 to $383 in the first month on top of the $1,847.15, so the VA structure saves $150 to $400+ monthly in this scenario.
The funding fee is also financed, not paid in cash, which means interest accrues on it. The $6,450 fee costs about $36 per month more on the payment and roughly $12,850 in interest across the full term; paying it at closing avoids that but costs cash today.
Boundary cases and where the estimate breaks down
The calculator guards its edges. Principal of 0 or below, or a term of 0, returns an input-check message rather than a payment. An APR of exactly 0% is handled: the formula still works because (1 + 0)^-360 = 1, the denominator becomes 1 - 1 = 0, and a division-by-zero guard in real inputs aside, a 0% rate means every dollar of the payment is principal, so the balance hits zero in exactly 360 level payments of loan / term. Note the fee is still applied even at 0% APR, so a $300,000 loan with the 2.15% fee at 0% interest is $306,450 / 360 = $851.25 per month.
High funding-fee presets scale results predictably: at 4.25% (cash-out refinance), the same loan finances $312,750 and the payment rises to $1,925.66, $38.79 more than the 2.15% case. What the tool does not model: escrow (property tax, homeowners insurance, HOA dues), the one-time or recurring VA usage fee tiers, rate buydowns (a 2-1 buydown changes the first two years only), and rounding conventions. Lenders quote to the penny with escrow included, so expect your official Loan Estimate to differ from the hero number by escrow plus normal rate-lock variance.
Also, the amortization table rounds each display row but the underlying balance math is continuous, so year-end balances can differ from a lender schedule by a few dollars from payment-date conventions. Use the table to see shape, not to reconcile a servicer statement.