VA loans in San Diego: how they work in 2026

This guide is for active-duty service members, veterans and eligible surviving spouses thinking about buying in San Diego County. A VA loan is a mortgage from a regular lender that the Department of Veterans Affairs partly guarantees. That guarantee is why lenders can offer no down payment and no mortgage insurance. Every rule and fee below comes from va.gov, the Federal Housing Finance Agency (FHFA) and the California Board of Equalization, current as of October 2026.

Full entitlement means no loan limit

Your entitlement is the amount VA will guarantee for you, shown on your Certificate of Eligibility (COE). If you have full entitlement, VA's own wording is that you "don't have a loan limit (as long as you can afford the loan amount and the property appraisal supports the purchase price of the home)." The lender still decides how much you qualify for based on income, debts, credit and assets. You must also plan to live in the home: a VA purchase loan is for your own residence, not a pure rental.

When the 2026 San Diego County limit matters

If you still have entitlement tied up in an earlier VA loan (for example, you kept a house from your last duty station and rent it out), you have remaining entitlement, and that is where the county limit comes in. For 2026, the conforming loan limit for a one-unit home in San Diego County is $1,104,000. VA's formula: multiply the county limit by 25 percent, subtract the entitlement already used, and multiply the result by 4 to get the most you can borrow with no down payment.

Above that amount you can still use a VA loan, but the lender will typically want a down payment to cover the part VA doesn't guarantee. Ask your lender for the exact figure with your COE in hand.

The VA funding fee

The fee is a percentage of the loan amount. On an $800,000 purchase with nothing down, a first-time user pays 2.15 percent, or $17,200. You can pay it at closing or roll it into the loan. The second-use rate of 3.3 percent only applies with less than 5 percent down, so a repeat VA buyer who can put 5 percent down cuts the fee by more than half.

No PMI, and what the seller can pay

VA loans carry no private mortgage insurance (PMI) or mortgage insurance premium (MIP), and no prepayment penalty either. Buyers usually pay costs like the appraisal, credit report, title insurance and recording fees, and sellers can cover concessions worth up to 4 percent of the home's reasonable value. See Buyer closing costs in San Diego for what those line items run locally.

Appraisals, repairs and condos

A VA appraiser, hired through your lender, sets the value and checks VA's Minimum Property Requirements (MPRs): the home has to be safe, structurally sound and sanitary. Items that come up often include a roof near the end of its life, heat that can't keep plumbing areas at 50°F, chipping lead-based paint in a pre-1978 home, and termites or dry rot. Required repairs generally must be done before closing, and who pays is negotiated with the seller. NerdWallet puts VA appraisal fees at roughly $600 to $1,200 depending on location and property type.

What a VA loan buys: illustrative payment math

We used 7.25 percent because Freddie Mac's weekly survey put the average 30-year fixed rate for conventional loans at 7.28 percent on October 1, 2026. VA rates are set by each lender and can differ. Add property tax (rates and due dates), homeowners insurance, any HOA dues and, in many newer communities, Mello-Roos special taxes (what Mello-Roos is). Compare the total against your housing allowance with San Diego BAH rates for 2026.

California property tax break for disabled veterans

California's Disabled Veterans' Exemption reduces the assessed value of your home if you are rated 100 percent disabled by VA, are paid at the 100 percent rate because you can't work, are blind in both eyes, or have lost the use of two or more limbs. For 2026 the basic exemption is $180,671 off assessed value. The low-income exemption is $271,009 for households with income at or under $81,131. File form BOE-261-G with the San Diego County Assessor within 90 days of qualifying or by the following January 1, whichever is later. The low-income version must be refiled each year between January 1 and February 15. An unmarried surviving spouse can also qualify.