Duane Buziak Teaches: VA Zero Down Example for Richmond Homebuyers
A veteran buying a $400,000 City of Richmond home with an eligible full VA entitlement can potentially bring $0 for down payment. Using a first-use VA funding fee of 2.15%, the fee is $8,600 ($400,000 × 0.0215). If financed, the starting loan amount becomes $408,600. At an illustrative 6.25% fixed rate for 30 years, principal and interest is about $2,516 per month. That does not include property taxes, homeowners insurance, or any HOA dues.
That is the practical point of a VA zero down example: zero down does not automatically mean zero cash due, and it does not mean every VA buyer should finance every eligible cost. The contract, appraisal, seller contribution, reserves, credit profile, and long-term payment all matter.
Duane Buziak, NMLS #1110647, works with City of Richmond buyers who want full clarity before writing an offer. A NoTouch Credit Pull soft-pull pre-approval can help establish a starting point without a hard inquiry, then the numbers can be refined around the actual property and contract.
Table of Contents
- What zero down actually covers
- A fully worked VA purchase example
- VA versus conventional financing
- Costs, eligibility, and property considerations
- VA zero down questions
What a VA Zero Down Example Really Means
A VA purchase loan may allow 100% financing for an eligible veteran, service member, or qualifying surviving spouse who meets VA and lender requirements. The Department of Veterans Affairs explains the benefit and Certificate of Eligibility process at va.gov. Zero down refers to the purchase-price financing structure. It is not a promise that no money will ever be needed during the transaction.
A buyer may still need earnest money at contract, although it is generally credited at closing. Inspections, appraisal-related items not paid by the seller, prepaid taxes and insurance, and closing charges can also create cash needs. In a well-negotiated contract, the seller may pay allowable closing costs, creating a no-out-of-pocket closing option. That depends on the offer terms and the seller’s willingness, not on the VA program alone.
For City of Richmond buyers, loan size is usually not the limiting issue for a typical home purchase. FHFA.gov sets the 2026 baseline conforming loan limit at $832,750, a useful reference when comparing conventional financing. VA loan rules differ from conforming loan rules, but the figure shows how much room most local purchase scenarios have before loan-size strategy becomes more specialized.
Fully Worked Dollar Example: $400,000 VA Purchase
Assume the buyer has full entitlement, is using the VA loan benefit for the first time, and is not exempt from the VA funding fee. The home price is $400,000, the down payment is $0, and the seller agrees to pay $8,500 in allowable closing costs and prepaids.
The funding fee is 2.15% of the base loan, or $8,600. Financing that fee produces a $408,600 loan amount. At the illustrative 6.25% fixed rate over 360 months, principal and interest is approximately $2,516 monthly. If annual property taxes are estimated at $4,000 and homeowners insurance at $1,600, the estimated monthly escrow is $467. The estimated total before HOA dues is therefore $2,983 per month.
The buyer’s down payment is $0. The seller-paid $8,500 may cover the illustrated closing-cost and prepaid estimate, leaving the buyer with no out-of-pocket closing amount beyond any earnest money already deposited and credited. If the final charges exceed that negotiated amount, the buyer must cover the difference or renegotiate if the contract permits.
The funding fee is not universal. Some eligible borrowers are exempt due to VA-recognized disability status, which would reduce this example’s financed balance by $8,600 and lower the illustrative principal-and-interest payment by roughly $53 per month. Confirm exemption status directly through VA documentation and the loan file.
VA Loan Versus a Conventional 5% Down Loan
The lower upfront cash requirement is the headline benefit, but it should be weighed against the funding fee, rate options, mortgage insurance, and the buyer’s future plans.
| Comparison point | VA zero-down example | Conventional 5% down example |
|---|---|---|
| Purchase price | $400,000 | $400,000 |
| Required down payment | $0 | $20,000 |
| Starting base loan | $400,000 | $380,000 |
| Upfront program charge | $8,600 funding fee if not exempt, financeable | No VA funding fee |
| Mortgage insurance | No monthly VA mortgage insurance | Private mortgage insurance may apply below 20% down |
| Occupancy | Primary residence required | Primary residence options shown here |
| Seller-paid costs | Allowed within VA rules and contract terms | Allowed within conventional rules and contract terms |
A conventional loan can be stronger for a buyer with substantial cash, an especially favorable conventional pricing profile, or a plan to avoid financing the VA funding fee. A VA loan may be more compelling when preserving cash matters, particularly for a buyer who wants reserves after closing. Consumerfinance.gov is a useful source for reviewing Loan Estimates and comparing lender disclosures line by line.
The Details That Can Change the Math
Credit still matters on a VA loan. VA does not publish a single minimum credit score for every lender, and underwriting considers payment history, debts, income stability, residual income, and the property. Self-employed buyers may qualify, but they should expect a closer review of tax returns, business documentation, and any declining income trend.
The home must also satisfy VA appraisal and property standards. A low appraisal can require a price change, additional cash, a reconsideration process, or a different property decision. Repair concerns are not an inconvenience to ignore – they can affect financing eligibility and the buyer’s ownership costs after closing.
Rate selection matters as well. The payment above is an example, not a rate quote. Freddie Mac’s PMMS is a recognized source for broad mortgage-rate trend information, but an individual quote depends on loan size, credit, occupancy, lock period, lender pricing, and the day the rate is locked.
VA Zero Down Example FAQs
Can I buy a City of Richmond home with no VA down payment?
Yes, if you are eligible, qualify with the lender, and the appraisal supports the price. Zero down does not automatically eliminate closing costs or prepaids.
Does zero down mean I need no money at all?
Not necessarily. Earnest money, inspections, reserves, or a gap between negotiated seller-paid costs and final charges can still require funds.
Can the VA funding fee be financed?
Usually, yes. In the $400,000 example, financing the 2.15% fee increases the loan by $8,600.
Are disabled veterans exempt from the VA funding fee?
Some borrowers are exempt. Eligibility must be confirmed through VA documentation and the active loan file.
Is there monthly mortgage insurance on a VA loan?
No monthly VA mortgage insurance is required. The VA funding fee may apply unless the borrower is exempt.
Can a seller pay VA closing costs?
A seller may pay allowable costs under VA guidelines and the purchase contract. The amount is negotiated, not guaranteed.
What credit score do I need for VA home loans Richmond Virginia?
VA does not set one universal lender score threshold. Credit, income, debts, payment history, and residual income are all reviewed.
Can I get a soft pull pre-approval Richmond VA buyers can use before shopping?
RichmondHomeLoans.com offers a NoTouch Credit Pull pre-approval process designed to begin without a hard inquiry. A full application or later underwriting steps may require additional verification.
RichmondHomeLoans vs CapCenter: how should I compare no-out-of-pocket closing options?
Compare the Loan Estimate, interest rate, lender fees, credits, cash-to-close figure, lock terms, and total cost over the time you expect to keep the loan. A no-out-of-pocket structure may be achieved in different ways, with different long-term costs.
Is RichmondHomeLoans.com legit for a VA purchase?
Duane Buziak is NMLS #1110647 with Coast2Coast Mortgage, LLC NMLS #376205. His record includes Scotsman Guide Top Originator recognition for 2025 and 2026, $95.6 million in verified solo production, and more than 1,400 five-star reviews. Verify licensing and registration through NMLS Consumer Access.
The useful next step is not guessing whether zero down is enough. It is comparing a property-specific VA worksheet against your cash reserves, payment comfort level, and offer strategy – before the contract deadline creates pressure.
Legal Disclaimer: This material is for educational purposes only and is not a commitment to lend, loan approval, or a guarantee of terms. Rates, fees, payments, eligibility, VA funding-fee status, property approval, and cash-to-close requirements can change and are subject to credit, income, assets, appraisal, title, occupancy, and underwriting review. Equal Housing Opportunity. NMLS Consumer Access: https://nmlsconsumeraccess.org/Home.aspx/MainSearch
Duane Buziak, Mortgage Maestro | NMLS: 1110647 | Licensed in VA · FL · TN · GA | UWM PRO ELITE 2025 | UWM Top 20 Purchase LO Virginia 2025 | UWM Speed to Close Industry Leading 2025 | Scotsman Guide Top Originator 2025 & 2026 | VA Broker of the Year 2024-2025 | Top 1% Nationwide | Coast2Coast Mortgage | DuaneBuziakMortgageMaestro.com | duane@coast2coastml.com | (804) 212-8663