How Much Can I Borrow With No Down Payment on a VA Loan?

When it comes to mortgages, ones backed by the Department of Veterans Affairs come with heaps of perks. None are quite as exciting, though, as the 0% down payment. 

While borrowers still need to hand over some cash for closing costs, the ability to get into a house without any money down is undeniably awesome. It dramatically lowers the barrier to homeownership for qualifying active-duty military members and veterans. 

It might feel like such a good deal would come with a catch. Actually, the VA is pretty generous here. In 2020, they did away with limits on VA loans. 

Today, borrowers with full entitlement (more on that below) can borrow as much as the lender will approve. If you want to buy a multi-million dollar house and the lender thinks you can afford to repay that loan, the VA will back it. And that means you can get the keys with $0 down. 

That’s a very broad overview, though. To understand when limits might shape your no-down-payment VA loan, it helps you learn what applies to your specific situation.  

If you’ve never had a VA loan before

If you’ve never had a VA loan and you qualify for one, you have full entitlement. That means there’s technically no limit on how much you can borrow with a VA loan.

But it doesn’t mean you can get a massive mortgage, no questions asked. Lenders care about you being able to repay what you borrow.

This matters because you won’t get your home loan directly from the VA (unless you qualify for the Native American Direct Loan program). Instead, you’ll work with a mortgage lender that offers VA loans. And just like they would with any other mortgage, that lender will check to make sure you can afford to repay the VA loan. That means they’ll look at your income, credit score, and other factors.

On top of that, the VA has requirements in place to make sure people don’t borrow more than they can handle. Specifically, they require lenders to look at your residual income. 

This is the amount of money you would have left over each month after paying your mortgage and other debts. The residual income requirement essentially checks that you’ll be able to afford basics like groceries after paying what you owe. 

So there’s technically no ceiling on how much you can borrow, but there are rules designed to make sure you can repay your mortgage. As your financial standing goes up (higher income, better credit score, etc.), the size of the loan you can get goes up, too. 

If you’ve had a VA loan in the past

You can use a VA loan more than once. But some of the details about what the VA will offer you with no down payment change once you’ve used up part of your entitlement.  

If you’ve fully paid off the VA loan and sold the property

In this situation, you should have fully restored your entitlement. (You can check your certificate of eligibility to make sure.) With full entitlement, everything we just outlined above applies to you. 

If you fully paid of the loan and have been granted a one-time restoration

If you fully paid off the VA loan but you still own the house, you can apply for a one-time entitlement restoration. The VA allows this option so you can buy a new house with a VA loan but keep the first fully paid-off one, maybe as a vacation home or a rental property. 

If you applied for one-time restoration and it got approved, you’re back to full entitlement. And that means everything above applies to you. You don’t have any limits except ones based on your ability to repay what you borrow. 

If you still have a VA loan

If you currently have a VA loan with a balance, you actually do have a limit on how much you can borrow. The VA bases that on two things: how much of your entitlement you’ve used and the lending limit set by the Federal Housing Finance Agency (FHFA) for your area. 

You can use our VA loan entitlement calculator to figure out how much you can borrow with 0% down. For that, you’ll need to know your remaining entitlement.  

To get that info, you’ll need your certificate of eligibility. Right up top, you should see the table titled “Prior Loans charged to entitlement.” Scan the column headers until you see one that says, “Entitlement Charged.” That’s the number you want to input into the calculator where it says, “Used Entitlement.” 

The calculator will tell you the max amount you can borrow with no down payment. If you want to buy a house that costs more than that, you potentially still can. You just need to put up a down payment that’s 25% of the overage. If you want to buy a $400,000 house but you only have enough entitlement to cover $300,000, for example, you would need a down payment of $25,000 (25% of the $100,00 difference). 

If you don’t want to do any math to figure out how much you can borrow with 0% down, a VA lender can crunch the numbers for you. 

Whether you’re trying to get your first VA loan or figure out how much you can borrow with another one, we have a list of lenders that can help you. To explore leading VA lenders and what they’re offering today, check out our rate table.

‍