Residual Income

What is VA residual income?

Short answer

Residual income is the dollars left after the borrower pays the new mortgage payment, property taxes, insurance, HOA, all monthly debts, taxes, and utilities (estimated). VA sets minimum residual amounts by region and family size — Florida sits in the South region table.

Plain-English explanation

Residual income is VA's signature underwriting metric. Calculation: gross qualifying income minus federal/state/payroll taxes, minus the new full housing payment (P&I, taxes, insurance, HOA, CDD, MIP), minus all monthly debts on the credit report, minus an estimated maintenance and utilities figure (typically 14 cents per square foot per month), equals residual. The remainder must meet or exceed VA's minimum for the household's region and family size. Florida is in the South region table. Subject to VA guidelines.

Practical example

A Florida (South region) family of four buying at $400k with a $3,200 full housing payment, $400 in other debts, and $7,000 gross monthly income with $1,400 in taxes withheld lands at roughly $2,000 in residual after the full deduct stack. South-region table for family of 4 typically lists $1,003 minimum on a loan above $80k — the file clears with a comfortable cushion.

What can change the answer?

Family size, household region (Florida = South), full housing payment, monthly debts, and an estimated maintenance/utilities figure all affect residual.

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VA guidelines are the rule. Your COE, entitlement, residual income, property, and Florida costs are what decide the actual answer.

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