{"id":21337,"date":"2021-01-28T15:23:46","date_gmt":"2021-01-28T23:23:46","guid":{"rendered":"https:\/\/www.homelight.com\/blog\/?p=21337"},"modified":"2024-03-25T10:09:16","modified_gmt":"2024-03-25T17:09:16","slug":"buyer-how-much-house-can-i-afford-va-loan","status":"publish","type":"post","link":"https:\/\/www.homelight.com\/blog\/buyer-how-much-house-can-i-afford-va-loan\/","title":{"rendered":"Here\u2019s How Much House You Can Afford Using Your VA Loan"},"content":{"rendered":"

If you\u2019re a veteran, actively serving in the military, or a qualified military spouse \u2014 you\u2019re entitled to special benefits to help you purchase a home through the Department of Veterans Affairs (VA)<\/a>. (And thank you for your service!) This is undoubtedly a good thing, especially as these loans typically have no down payment<\/a> \u2014 a huge benefit and a major assist toward your goal of buying that new home. But it\u2019s not always easy to understand exactly how much house you can afford with a VA loan.<\/p>\n

There are online calculators<\/a> that can help point you to some raw numbers, but that\u2019s just a start when assessing affordability for your house hunt<\/a>. To help you better understand the full context of your home search<\/a> with a VA loan, ask yourself (with help from your agent and lender) these nine questions about your entitlement, current military activity or enrollment, and finances to help paint a clear image of the kind of house you can buy with a VA loan.<\/p>\n

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<\/a> Source: (Tim Mossholder \/ Unsplash)<\/figcaption><\/figure>\n

Have you used your VA home loan benefits before?<\/h2>\n

If you qualify for a VA loan, the VA grants you an entitlement, which in conversational language is known as the amount that the VA will guarantee on the loan.<\/p>\n

The basic entitlement is $36,000. Lenders are typically willing to lend as much as four times that amount to borrowers without a down payment. (More on this later.)<\/p>\n

Whether or not you\u2019ve used your VA home loan benefits already will affect your level of entitlement. And that obviously influences how much you can borrow.<\/p>\n

What kind of entitlement do you have?<\/h2>\n

You can learn what your entitlement is on a certificate of eligibilit<\/a>y (COE); applying for one is the first step in getting your VA loan.<\/p>\n

Let\u2019s take a closer look at the types of entitlement so you can identify where you fall.<\/p>\n

Full entitlement<\/h3>\n

In addition to the basic entitlement of $36,000 and a maximum loan amount of $144,000, most borrowers around the country are granted an additional \u201cfull\u201d (maximum) entitlement amount of 25% of the conforming loan limit for the county<\/a> where the home is located. Conforming loan limits are set by the Federal Housing Finance Agency on a county-by-county basis.<\/p>\n

You\u2019re looking at full entitlement if you haven\u2019t used your VA loan before, or you\u2019ve paid off any previous VA loans and<\/i> sold the property associated with them and you\u2019re looking to purchase a home valued over $144,000 (if the value is less than the $144,000 the basic entitlement is all that will be needed to purchase the home).<\/p>\n

The conforming loan limit for most of the nation as of 2020 is $548,250. That means the VA will generally guarantee up to $137,062, which then means VA lenders should<\/i> be willing to offer you a loan up to<\/i> that $548,062 loan limit \u2014 as long as you have not utilized all or a portion of your entitlement.<\/p>\n

Remaining entitlement<\/h3>\n

If after purchasing a home and using only a portion of your full entitlement, you wish to buy another home, or if perhaps you ran into a little difficulty and defaulted on your original VA loan, you may still have access to the remaining entitlement, or unused entitlement, for a new loan.<\/p>\n

With remaining entitlement, your VA home loan limit is based on the county loan limit where the house is located. If you default on the loan, the VA will guarantee up to 25% of the county loan limit, after subtracting the amount of entitlement that you already used.<\/p>\n

You\u2019re going to be looking at using your remaining entitlement if you see yourself in any of the following categories:<\/p>\n