Last reviewed: November 4, 2026 · Chicago Condo Loans Editorial Team · How we research
Quick answer You can buy a Chicago condo with a VA loan if you will live in it and the building is a VA-approved condominium project. VA approves the project’s legal documents, not individual units, and an FHA approval does not count as VA approval. With full entitlement there is no VA loan limit and no down payment is required when the price does not exceed the appraised value. There is no mortgage insurance, but most borrowers pay a one-time funding fee of 1.25% to 3.3% of the loan. If the building is not on VA’s list, your lender can submit the association’s documents to VA for review.
This guide is part of our complete guide to Chicago condo loans.
Does a Chicago condo need VA approval?
Yes. Under 38 CFR 36.4360(c), before VA guarantees a loan on an individual condominium unit, the legal documents establishing the condominium must be approved by VA. VA’s purchase loan page lists the eligible use as buying a condo in a VA-approved project. There is no separate VA approval for a single unit the way FHA offers single-unit approval (see our FHA condo approval guide). VA loans also can’t currently be used to buy a co-op apartment; see co-op loans in Chicago.
This is a different check from the conventional condo review most Chicago buyers hear about. For a conventional loan, the lender reviews the building against Fannie Mae or Freddie Mac rules (see warrantable vs. non-warrantable condos). For a VA loan, VA itself must have accepted the project, and your lender still underwrites you, the unit and the appraisal.
How do I check whether a Chicago building is VA-approved?
- Search VA’s Condo Report on the LGY Hub by state, county (Cook) or project name. Chicago buildings often appear under the association’s legal name, which may differ from the building’s street name or marketing name.
- Read the status, not just whether the building appears. VA’s lender training materials list statuses including Accepted Without Conditions, Accepted With Conditions, HUD Accepted, Pending, Rejected, Suspended and Unknown. If it says Accepted With Conditions, ask the lender what the conditions are and whether they affect your purchase.
- Ask the listing agent or management company whether the association has pursued VA approval, and ask your lender to confirm the status in VA’s system before you write an offer that depends on VA financing.
A building on HUD’s FHA-approved list is not automatically on VA’s list. VA stopped accepting HUD/FHA condo approvals in place of its own review on December 7, 2009 (VA Circular 26-09-19); projects approved by both agencies before that date kept their approval, which is why some older projects show as HUD Accepted. More in our post Is an FHA-approved condo also VA-approved?
What if the building is not VA-approved?
A lender can ask VA to review the project. VA’s quick reference guide for lenders describes submitting the request in VA’s WebLGY system and uploading these documents:
| Document | Why it matters |
|---|---|
| Declaration, bylaws and all amendments | The legal documents VA must approve under 38 CFR 36.4360 |
| Plat map | Shows the units and common elements the declaration creates |
| Rules and regulations | Building rules that bind owners and tenants |
| Recent meeting minutes | Can reveal repairs, disputes or assessments in the works |
| Budget | Shows the association’s income, expenses and reserves |
| Special assessment letter | States whether any special assessment is levied or planned |
| Litigation letter | States whether the association is involved in lawsuits |
| Presale letter | For new or converted projects, how many units have sold |
Practical points for Chicago buyers:
- Start early. The review depends on the association producing complete, recorded documents, and the lender has to prepare and upload the package. Build the time into your contract’s financing contingency.
- The association is the source of most of these documents. The Illinois Section 22.1 resale disclosures (declaration, bylaws, rules, budget, reserves, pending suits and more) overlap with much of VA’s list. See our condo questionnaire and HOA review guide.
- Approval helps future buyers too. Once a project is accepted, later VA buyers in the building can rely on it, which can be a selling point for the association.
- If VA will not approve the project, a VA loan is not available for that unit. Your options are a conventional loan (if the building is warrantable), FHA (if the building is approved or qualifies for single-unit approval) or a portfolio loan.
How much can I borrow, and do I need a down payment?
VA says borrowers with full entitlement have no loan limit, as long as they can afford the loan and the appraisal supports the price, and need no down payment when the sales price does not exceed the appraised value. That matters in Chicago, where a VA borrower with full entitlement can buy a condo priced above the $832,750 conforming limit without a jumbo loan, if a lender will make the loan and you qualify.
If you have remaining entitlement because another VA loan is still outstanding, your lender calculates it using the county loan limit (Cook County’s 2026 one-unit conforming limit is $832,750, per FHFA, announced Nov. 25, 2025). VA notes that most lenders require your entitlement, your down payment, or both to cover at least 25% of the loan amount, so a down payment may be needed.
What does a VA condo loan cost compared with FHA and conventional?
VA loans have no private mortgage insurance and no FHA-style monthly premium. Instead, most borrowers pay a one-time funding fee, which can be paid at closing or financed into the loan. On a purchase loan, the funding fee is the only fee that can be financed; other closing costs are paid at closing (VA.gov, updated Oct. 5, 2026). The rates below have been in effect since April 7, 2023.
| Down payment | First use | After first use |
|---|---|---|
| Less than 5% | 2.15% | 3.3% |
| 5% or more | 1.5% | 1.5% |
| 10% or more | 1.25% | 1.25% |
Example: on a $300,000 condo loan with no down payment and first use of the benefit, the funding fee is 2.15%, or $6,450. You are exempt from the funding fee if you receive VA compensation for a service-connected disability, are eligible for it but receive retirement or active-duty pay instead, receive Dependency and Indemnity Compensation as a surviving spouse, have a proposed or memorandum rating before closing as a service member, or received a Purple Heart on or before closing while on active duty.
| Detail | VA | FHA | Conventional (Fannie Mae) |
|---|---|---|---|
| Minimum down payment | 0% with full entitlement | 3.5% with a 580+ credit score | 3% with an eligible program |
| Mortgage insurance | None; one-time funding fee instead (1.25%–3.3%, some borrowers exempt) | 1.75% upfront plus an annual premium | PMI below 20% down; can be cancelled |
| Building approval | VA-approved project (no single-unit option) | FHA-approved project or single-unit approval | Lender review under Fannie Mae or Freddie Mac rules |
| 2026 Cook County loan size | No VA limit with full entitlement | $541,287 (one unit; HUD ML 2025-23) | $832,750 conforming (FHFA, Nov. 25, 2025); jumbo above |
| Occupancy | Must live in the home | Must live in the home | Primary, second home or investment |
Seller help: VA lets sellers give credits for some or all of your closing costs and does not limit those credits, but it caps seller concessions at 4% of the home’s reasonable value.
Do I have to live in the condo?
Yes. Federal law (38 U.S.C. 3704(c)) requires you to certify, both when you apply and when the loan closes, that you occupy or intend to occupy the property as your home. If you are on active duty and cannot live there because of your service, the requirement can be met when your spouse occupies or intends to occupy the home and makes the certification, or, in some cases, when a dependent child will live there.
That means a VA loan is not a way to buy a Chicago condo purely as a rental or a second home. For those, see our guide to investment condo loans and second homes.
What else should a VA buyer check in a Chicago condo building?
- Special assessments and repairs. VA’s document list includes a special assessment letter and a litigation letter. Older Chicago high-rises may face façade, balcony or mechanical work; see our high-rise guide for the façade ordinance.
- The association’s legal name. Search the VA Condo Report by that name as well as the address.
- New conversions. VA’s document list includes a presale letter for converted and newly built projects, so ask how many units have sold before relying on VA financing in a building that is still selling units.
- The same unit may qualify for several loan types. If the building is VA-approved and warrantable, compare the full cost of each, including the VA funding fee (unless you are exempt) against conventional PMI and pricing adjustments.
Frequently asked questions
Does a Chicago condo need VA approval for a VA loan?
Yes. Federal rules require VA to approve the legal documents that set up the condominium before it will guarantee a loan on a unit there (38 CFR 36.4360). VA’s purchase loan page says a VA loan can be used to buy a condo in a VA-approved project. If the building is not approved, a lender can submit its documents to VA for review.
If a building is FHA-approved, is it also VA-approved?
Not automatically. VA stopped accepting HUD/FHA condo approvals in place of its own review on December 7, 2009 (VA Circular 26-09-19). Projects approved by both agencies before then kept their status. Check VA’s own Condo Report rather than HUD’s list.
Does VA offer single-unit approval like FHA?
No. FHA can approve one unit in a building that is not on its list, but VA’s rule is that the condominium project’s legal documents must be approved by VA before it guarantees a loan on any unit. If the building is not approved, the path is a project review, not a unit approval.
How much do I need to put down on a condo with a VA loan?
Nothing, if you have full entitlement and the price does not exceed the VA appraised value. With full entitlement there is no VA loan limit. If part of your entitlement is tied up in another VA loan, your lender may require a down payment so that your entitlement and down payment together cover at least 25% of the loan.
What is the VA funding fee on a condo purchase?
The same as for any VA purchase: 2.15% of the loan amount on first use with less than 5% down (3.3% after first use), 1.5% with 5% or more down, and 1.25% with 10% or more down. You can pay it at closing or finance it. Veterans receiving VA compensation for a service-connected disability, and some others, are exempt.
Can I use a VA loan for a Chicago condo I will rent out?
Not as a rental purchase. The law requires you to certify, when you apply and at closing, that you occupy or intend to occupy the home. An active-duty service member can meet this if a spouse, or in some cases a dependent child, will live there. For a unit you will rent out, see our guide to investment condo loans.
Can the seller pay my closing costs on a VA condo loan?
Yes. VA lets sellers give credits for some or all of your closing costs and does not limit those credits, but it limits seller concessions to no more than 4% of the home’s reasonable value.
Sources
- 38 CFR 36.4360, Condominium loans (eCFR)
- 38 U.S.C. 3704(c), occupancy certification
- VA.gov: VA-backed purchase loan
- VA.gov: VA funding fee and loan closing costs
- VA.gov: VA home loan limits and entitlement
- VA LGY Hub: Condo Report
- VA Loan Guaranty Service: Condo Approvals for Lenders (quick reference guide, March 2020)
- VA Circular 26-09-19: HUD/FHA condominium approvals no longer accepted (November 30, 2009)
- VA lender training: Condominium approval process (2016), condo statuses
This guide is educational and is not lending, legal, or financial advice. Chicago Condo Loans is not a lender or broker. Rules and pricing change and every building and borrower is different, so confirm details with a licensed mortgage professional and an Illinois attorney. See our Disclaimer.