Use this comprehensive VA Loan Mortgage Calculator to quickly estimate your total monthly payment (PITI), including Principal & Interest, Property Tax, Homeowner’s Insurance, and the mandatory VA Funding Fee.
VA Loan Mortgage Calculator
Monthly Principal & Interest (P&I):
Monthly Tax & Insurance (T&I):
VA Funding Fee (One-Time Cost):
VA Loan Mortgage Payment Formula
The core P&I (Principal and Interest) monthly payment is calculated using the standard amortization formula:
M = P [ r(1 + r)^n / ((1 + r)^n - 1) ]
Where:
- M = Monthly Payment
- P = Principal Loan Amount
- r = Monthly Interest Rate (Annual Rate / 1200)
- n = Total Number of Payments (Loan Term in Years * 12)
The total PITI payment is then:
PITI = M + (Annual Tax / 12) + (Annual Insurance / 12)
Formula Source: Investopedia – Amortization, VA.gov – Funding Fee
Variables Explained
- Principal Loan Amount: The amount you are borrowing after any down payment.
- Annual Interest Rate (%): The rate your lender charges annually. This is converted to a monthly rate for calculation.
- Loan Term (Years): The duration over which the loan will be repaid (e.g., 30 years).
- VA Funding Fee (%): A mandatory, one-time fee paid to the VA. It varies based on service history, down payment, and prior use.
- Annual Property Tax: The estimated yearly property taxes on the home. Lenders typically collect 1/12th of this amount monthly.
- Annual Home Insurance (HOI): The yearly cost of homeowner’s insurance. Also collected monthly (1/12th).
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What is a VA Loan Mortgage?
A VA loan is a mortgage product backed by the U.S. Department of Veterans Affairs (VA). It is exclusively available to eligible U.S. veterans, active-duty service members, and certain surviving spouses. The key benefits include the ability to purchase a home with 0% down payment and no requirement for private mortgage insurance (PMI), which can make homeownership significantly more affordable than conventional options.
Despite the 0% down feature, VA loans are not “free.” They require a one-time VA Funding Fee, which is typically financed into the loan amount. This fee helps offset the cost to taxpayers and keeps the program running. Because the VA guarantees a portion of the loan, lenders take on less risk, allowing them to offer highly competitive interest rates and terms to eligible borrowers.
How to Calculate Your VA Monthly Payment (Example)
- Determine the Monthly Rate (r): If the annual rate is 6.5%, divide by 1200 (12 months * 100). $6.5 / 1200 = 0.0054167$.
- Determine Total Payments (n): For a 30-year term, multiply by 12. $30 \times 12 = 360$ payments.
- Calculate Monthly P&I (M): Plug Principal ($\$400,000$), $r$, and $n$ into the amortization formula. This gives your base P&I payment.
- Calculate Monthly Tax (T): Divide the annual property tax ($\$4,800$) by 12 months. $\$4,800 / 12 = \$400.00$.
- Calculate Monthly Insurance (I): Divide the annual homeowner’s insurance ($\$1,200$) by 12 months. $\$1,200 / 12 = \$100.00$.
- Calculate Total PITI: Sum the Monthly P&I (M), Monthly Tax (T), and Monthly Insurance (I) to find your total estimated monthly housing payment.
Frequently Asked Questions (FAQ)
Is the VA Funding Fee included in the monthly payment calculation?
The Funding Fee is a one-time fee, but it is usually rolled (financed) into the principal loan amount. This calculator shows the fee amount separately and uses the original principal for the P&I calculation, as the P&I calculation on the financed amount is complex and highly dependent on lender policy. Always confirm the final financed amount with your lender.
Can I waive the VA Funding Fee?
Yes, veterans who receive VA compensation for a service-connected disability, as well as surviving spouses of veterans who died in service or from a service-connected disability, are exempt from paying the Funding Fee.
What does PITI stand for?
PITI stands for Principal, Interest, Taxes, and Insurance. It represents the four components that typically make up your total monthly mortgage payment when using an escrow account.
Do VA loans require mortgage insurance (PMI)?
No, one of the biggest benefits of a VA loan is that it does not require Private Mortgage Insurance (PMI), even with a 0% down payment. This provides significant savings compared to conventional and FHA loans.