Your VA Loan House Payment
At first glance, your VA house payment is simply what you pay each month to your VA mortgage lender. And while that’s true, the VA loan payment is the result of several different factors, all working together.
The first and most important part of your house payment is your interest rate, term and principal borrowed. If you bought a home for $100,000 with no money down on a 30 year VA fixed rate of 3.50 percent, your principal and interest payment is $449.04. But hold the phone, because in addition to the $100,000 sales price there’s also the VA funding fee.
The VA funding fee can vary based upon usage and borrower status but for a first time purchase and a qualifying veteran, the VA funding fee is 2.15 percent, or $2,150.
The borrower can pay the funding fee with cash but most roll the funding fee into the loan amount. Now the loan amount is $102,150 and the VA house payment is $458.70.
But your VA house payment is more than the principal and interest, it also includes one-twelfth of your annual property tax bill. If your property taxes are $1,000 per year, your monthly payment rises by $83.33 to $542.03.
VA loans require you to keep your house insured so you’ll need to count on a monthly insurance payment. If your annual insurance bill is $500, your monthly payment rises by $41.67 to $583.70. That’s, it, right? Almost.
If you live in a neighborhood that has annual Homeowners Association, or HOA dues of $300 per year, your monthly payment goes up again. This time by $25 to $608.70. This final VA house payment amount is the figure your VA lender used to qualify you. Not just the principal and interest payment, but also property taxes, insurance and any association or homeowners dues.