VA Disability Compensation: Turning Benefits Into Buying Power
Navigating the VA system can feel complex. If you’re a 100% disabled veteran, you’re likely receiving monthly tax-free compensation—but how does that income translate into real-life buying power?
Here’s what matters: That VA disability check isn’t just assistance. It’s a qualifying income source that can help you become a homeowner.
Key Takeaways
- VA disability pay is considered qualifying income for VA home loans.
- Tax-free compensation can increase your borrowing power through "grossing up."
- A 100% disability rating offers the highest monthly benefit—up to $4,500/month with dependents in 2025.
- VA loans require no down payment and, for disabled veterans, no funding fee.
- You can qualify for a mortgage without traditional employment if your VA pay meets income requirements.
How VA Disability Compensation Is Calculated?
The Department of Veterans Affairs calculates compensation based on:
- Disability Rating: Ranging from 10% to 100%
- Dependents: Additional pay for spouse, children, and parents
- Cost of Living Adjustments (COLA): Updated annually
Example: 2025 VA Disability Rates for 100% Rating
All of the above is tax-free and eligible as mortgage income.
For updated compensation tables, visit the VA.gov Disability Rates Page.
Why VA Disability Pay Increases Your Mortgage Power?
VA disability pay is viewed by lenders as stable and reliable, even without employment. Here's how it stacks up:
Bonus: Lenders often "gross up" non-taxable income by 15% to 25%, increasing your borrowing capacity.
VA Disability & Home Loan Benefits
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Final Word: You Earned More Than Just Compensation
Your VA disability rating is more than a number—it’s a tool for opportunity.
Whether you're ready to own your first home or invest in passive income, your benefits are designed to empower your future.
Use them wisely.
FAQs: VA Disability & Mortgages
Is VA disability considered income for a mortgage?
Yes, it qualifies as stable income and is counted by VA lenders.
How are VA disability rates determined?
Based on your disability rating, number of dependents, and COLA adjustments.
How much is 100% VA disability in 2025?
Approximately $4,500/month if you have dependents.
Can I get a home loan with just VA disability income?
Yes, as long as your total income meets the lender's minimum DTI thresholds.
Does VA disability help with loan affordability?
Absolutely. It’s non-taxable, consistent, and counts fully toward loan qualification.
Required Disclosures
Be My Neighbour Mortgage is an Equal Housing Lender. NMLS ID #1743790. All loan applications are subject to underwriting approval. Terms and conditions apply. This material is for informational purposes only and does not constitute a loan offer or investment advice. Always consult with a licensed mortgage professional.
