VA Loan Down Payment Requirements
Saving up for a down payment is often the biggest hurdle for homebuyers—but if you’re a Veteran, active-duty service member, or eligible surviving spouse, VA loans offer a powerful alternative.
Backed by the U.S. Department of Veterans Affairs, VA loans are one of the few mortgage options that truly require no down payment in most cases. That means you can become a homeowner faster, without waiting years to save up 5% or 20%.
In this guide, we’ll break down how VA loan down payment requirements work, when a down payment might be needed, and how this benefit stacks up against other loan types. We’ll also cover important upfront costs to expect so you’re financially prepared from day one.
In this Article
What Is a VA Loan?
A VA loan is a government-backed mortgage option available to eligible Veterans, active-duty service members, and surviving spouses. Backed by the U.S. Department of Veterans Affairs, these loans offer major advantages over conventional loans—most notably, the ability to buy a home with no down payment and no PMI.
- Guaranteed by the U.S. Department of Veterans Affairs
- No private mortgage insurance (PMI) required
- 100% financing available with no down payment
- Competitive interest rates, often lower than conventional loans
- Flexible credit and income guidelines
How VA Loan Down Payments Work
Unlike conventional loans, VA loans do not require a down payment in most scenarios. Qualified borrowers can finance 100% of a home’s value. However, a down payment might still be required or beneficial in some circumstances, like exceeding county loan limits or reusing entitlement.
- VA does not cap loan amount, but limits the amount it guarantees
- Down payment required if loan exceeds county limits (see FHFA chart)
- Partial entitlement use may trigger a down payment requirement
- Voluntary down payments may reduce VA funding fee and improve loan terms
VA vs Other Loan Down Payments
| Loan Type | Minimum Down Payment | PMI/Mortgage Insurance | Eligible Borrowers |
|---|---|---|---|
| VA Loan | 0% | None | Veterans, Active Duty, Spouses |
| FHA Loan | 3.5% (580+ score) | Required | Most buyers |
| USDA Loan | 0% | Required | Low/moderate-income rural buyers |
| Conventional Loan | 3–20% | PMI if <20% | Broad eligibility |
When Is a VA Loan Down Payment Required?
Although VA loans usually allow 0% down, there are situations where a down payment may be necessary or strategically smart:
- Loan amount exceeds VA county limit – you pay the difference above the guarantee
- Reduced entitlement – happens if you already have a VA loan or haven’t restored benefits
- Second VA loan – using remaining entitlement may require partial down
- Improve terms – a down payment can lower your funding fee and interest rate
- Competitive edge – strengthens offers in hot markets
VA Funding Fee Reduction Table
| Down Payment | First-Time Use | Subsequent Use |
|---|---|---|
| 0% down | 2.15% | 3.30% |
| 5% down | 1.50% | 1.50% |
| 10% down | 1.25% | 1.25% |
View official fee structure on VA.gov.
What Costs Should You Expect at Closing?
Even with no down payment, VA buyers will encounter closing costs and prepaid expenses. These can range from 1%–5% of the loan amount depending on your lender and location.
- VA funding fee: 2.15%–3.3% (can be financed)
- Appraisal, title insurance, credit report fees
- Prepaid property taxes & homeowners insurance
- Lender fees: origination, underwriting, discount points
- Check if seller can cover your closing costs
Tips to Minimize Upfront VA Costs
Veterans can reduce upfront expenses with smart planning and by leveraging available benefits:
- Negotiate seller concessions to cover closing costs
- Use state veteran housing programs to offset expenses
- Compare VA-approved lenders for fee differences
- Explore grants for disabled veterans
Frequently Asked Questions About VA Loan Down Payments
Do VA loans really require no down payment?
- Yes, qualified borrowers can finance 100% of the home’s price with no down payment.
Why would I want to make a down payment on a VA loan?
- A down payment lowers your funding fee, improves your interest rate, and may help in competitive markets.
What is the VA loan limit in 2025?
- While VA loans technically have no limit, lenders may require down payments for loans above conforming limits (e.g., $766,550 in most counties).
Can I get a VA loan twice?
- Yes, you can reuse your VA loan benefit multiple times. If your entitlement is not fully restored, a down payment may be needed.
Does making a down payment reduce my monthly payment?
- Yes, it lowers your total loan amount and interest charges, which reduces your monthly payment.
Are there closing costs even if I put nothing down?
- Yes. Even without a down payment, you’ll pay closing costs like appraisal, title, taxes, and lender fees.
Can the seller pay my down payment?
- No. Sellers can cover closing costs but not a down payment if one is required.
How much is the VA funding fee without a down payment?
- For first-time use, it’s 2.15% of the loan amount. For subsequent use, it’s 3.3%.
Do I need a down payment for a VA jumbo loan?
- If your loan exceeds your entitlement amount, you’ll need to cover the difference, which acts like a down payment.
Can down payment assistance be used with a VA loan?
- Rarely. Since VA loans don’t require a down payment, assistance programs are often unnecessary—but may help with closing costs.
The Bottom Line: The VA Loan Down Payment Advantage
VA loans eliminate the biggest barrier to homeownership: the down payment. Veterans can buy a home with 0% down, no PMI, and favorable interest rates. But in some cases—like higher-priced homes or entitlement limits—a down payment may still be required or beneficial. Understanding how VA loan limits, funding fees, and closing costs interact ensures you’re financially prepared. Always compare lenders, review your certificate of eligibility, and leverage available VA and state resources to minimize out-of-pocket costs and secure the best deal possible.
- VA loan eligibility requirements
- Estimate your monthly payment
- Learn how to reduce your VA funding fee
- Compare VA vs. conventional loans
