Since the Blue Water Navy Vietnam Veterans Act of 2019, more Veterans can benefit from zero-down VA loans — even in expensive housing markets. The act takes VA loan limits out of the equation for many borrowers. Loan limits are defined as the maximum VA loan possible without a down payment. But now, loan limits are only applied to those with partial entitlement.
If you have full entitlement, the maximum VA guaranty is simply 25 percent of your loan amount — even if your loan is $1,000,000 or more.
Loan Limits Now Based on Entitlement
All first-time VA borrowers have full entitlement. Additionally, all borrowers who’ve used a VA loan to finance a home, and have since completely restored entitlement, also have full entitlement. You may also have full entitlement if you plan to sell a home financed with a VA loan to buy another one, in which case, full entitlement can be restored before closing. If you have full entitlement, then loan limits do not apply to you.
If part of your entitlement is occupied with another VA loan, and you plan to keep it there, then you have partial entitlement. Partial entitlement means loan limits apply. If you have partial entitlement, the maximum VA guaranty on your combined VA loans cannot exceed 25 percent of the loan limit for your area. You can still enjoy a zero-down-payment VA loan as long as your available entitlement is at least 25 percent of your loan.
Zero down payment is possible
Full entitlement means $0 down payment potential, even in high-cost housing markets
If you’ve ever shopped for a home, maybe you’ve seen with your own eyes how two very similar homes can have different price tags from neighborhood to neighborhood. In reality, certain housing markets are just more expensive than others. And a VA loan with a zero down payment is especially useful in these high-cost areas. That’s because, for borrowers with full entitlement, the VA no longer limits the size of loan it’s willing to guarantee. VA borrowers in San Francisco, California, and Washington, D.C., for example, will find that zero-down-payment VA loans of one million dollars or more are indeed possible. The graphic below shows states/territories with average home prices higher than the national average.
Places containing at least one county with higher home price averages:
Alaska
California
Colorado
District of
Columbia
Florida
Guam
Hawaii
Idaho
Maryland
Massachusetts
New
Hampshire
New Jersey
New York
Pennsylvania
Tennessee
Utah
Virgin Islands
Virginia
Washington
West Virginia
Wyoming
$0 Down Payment Still Possible With Partial Entitlement
These 2024 loan limits of $766,550, and up to $1,149,825, apply only to Veterans with partial entitlement.
Gold-shaded states have one or more high-cost counties.
2024 VA Loan Limits
$766,550 - $1,149,825
Exactly $766,550
What Zero Down Means to Veterans Today
For many Veterans, zero down payment is the primary reason for choosing a VA loan. If you have the qualifications, and the available entitlement, you may have the opportunity to obtain a VA loan with no down payment – even in the highest priced areas. At a time when the options of many would-be homebuyers are limited by the size of their down payments, this is a tremendous benefit for our Veterans.
Will Any Veterans Make a Down Payment?
Most VA loans have no down payment. But there are times when those who utilize the program do opt to make a down payment, either necessarily or voluntarily.
If a Veteran has only partial entitlement, and their new loan puts them over the conforming loan limit, a down payment can be used to secure the amount that’s over the limit.
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