A veteran has $50,000 in remaining VA entitlement and wants to purchase a home for $500,000. What is the minimum down payment required?
Correct Answer
B) $112,500
With $50,000 remaining entitlement, the veteran can obtain a loan for 4 times that amount ($200,000) without a down payment. For a $500,000 purchase, they need a down payment of 25% of the amount exceeding $200,000: 25% × $300,000 = $75,000, plus the amount exceeding their entitlement coverage, totaling $112,500.
Why This Is the Correct Answer
With $50,000 remaining entitlement, the veteran can obtain a loan for 4 times that amount ($200,000) without a down payment. For a $500,000 purchase, they need a down payment of 25% of the amount exceeding $200,000: 25% × $300,000 = $75,000, plus the amount exceeding their entitlement coverage, totaling $112,500.
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