How to read it
A VA lender runs two tests. Debt-to-income is the house payment plus your other debts, divided by your income before taxes. The guideline is 41%. Residual income is the cash left each month after taxes, the house, upkeep, and your debts. It has to clear a minimum set by family size. The price at the top is the lower of the two, which is the safer number to shop with.
BAH, BAS and VA disability are not taxed. Lenders are allowed to count them for more than face value on the debt-to-income test, usually 15% to 25% more. This calculator uses 25%. Ask your lender which figure they use.
If the residual number is the tight one, the residual income calculator breaks it down line by line. The VA loan page covers the funding fee, the appraisal, and what a seller can pay.
A retiree rated below 50% usually has disability pay offset against retirement pay. Check your award letter before you count both. Only a lender can pre-approve you, and their worksheet beats this one.
Common questions
How much house can I afford with a VA loan at Fort Sill?
It comes down to two tests. Your house payment plus other debts should stay near 41% of your income before taxes, and the cash left over each month has to clear the VA's residual income minimum for your family size. Put your pay and allowances in above and the calculator runs both.
Does BAH count as income for a VA loan?
Yes. Lenders count BAH, BAS and VA disability compensation as income, and because they are tax-free a lender can count them for up to 25% more than face value on the debt-to-income test.
Who does not pay the VA funding fee?
A veteran who receives VA disability compensation, an active-duty Purple Heart recipient, and a surviving spouse receiving DIC pay no funding fee. Most other first-time users pay 2.15% with less than 5% down, and it can be financed into the loan.