Do VA Loans Have Limits? Here’s the Breakdown

Are you preparing for the mission of homeownership? While buying a home comes with a lot of rewards, doing it with a VA loan brings even more perks to the table. A VA loan is a mortgage loan guaranteed by the U.S. Department of Veterans Affairs (VA), designed to help Veterans, service members, and eligible spouses purchase a home with flexible and favorable terms. 

One of the biggest benefits? Qualified borrowers can purchase a home with 0% down – no private mortgage insurance (PMI)An insurance policy that protects the lender in case you default on your loan. Mortgage insurance is required for FHA loans and for Conventional loans when you put down less than 20%.private mortgage insurance (PMI)An insurance policy that protects the lender in case you default on your loan. Mortgage insurance is required for FHA loans and for Conventional loans when you put down less than 20%. required. 

What is the VA Loan Limit? 

Let’s clear up a common point of confusion: The VA doesn’t cap how much you can borrow. What people often refer to as "VA loan limits" only apply to Veterans who don’t have full entitlement available. 

If you currently have another VA loan or lost one to foreclosure, you may not have full entitlement – and that’s when loan limits come into play. These limits help determine how much you can borrow without needing to make a down payment. 

Loan limits are set by county and based on local housing costs. Not sure what your entitlement status is? The team here at Atlantic Bay can help you break it down.

Do You Have Full Entitlement? 

Full entitlement means the VA will guarantee your loan without applying any loan limit. You likely have full entitlement if: 

• You’ve never used your VA home loan benefit. 

• You’ve paid off a previous VA loan and sold the property. 

• You’ve had a prior VA loan but repaid the VA in full after a foreclosure or short sale. 

You can check your entitlement status with your Certificate of Eligibility (COE), which outlines how much of your benefit is currently available to use. 

Since 2020, if you have full entitlement, there are no VA loan limits. You can borrow as much as your lender will approve –without a down payment – based on your income, credit, and the home’s value. 

What If You Have “Remaining Entitlement”? 

If your COE shows you have remaining (or partial) entitlement – meaning more than $0 but less than the full amount – then VA loan limits will apply. 

These limits are tied to the Federal Housing Finance Agency’s (FHFA) conforming loan limitsThe maximum dollar amount for mortgages that government-sponsored enterprises Fannie Mae and Freddie Mac are willing to purchase or guarantee.conforming loan limitsThe maximum dollar amount for mortgages that government-sponsored enterprises Fannie Mae and Freddie Mac are willing to purchase or guarantee.. 

Expert Tip

VA loan limits don’t cap your total borrowing power. If the home you want costs more than the loan limit in your county, you can still buy it. You may just need to contribute a down payment to cover the difference, based on your remaining entitlement.

What’s Possible for You? 

Understanding how VA loan limits work – especially in relation to your entitlement status – can help you plan your homebuying strategy with confidence. 

And whether you’re using your VA loan benefit for the first time or again, talking to the Atlantic Bay team is a smart move. We’ll help you review your COE, determine how much house you can afford, and walk you through the next steps on your journey to homeownership.