If you’re a veteran rated at 100% disability, understanding the upcoming VA compensation changes is essential for financial planning in the year ahead.

Will VA disability increase in 2025? If you're a veteran counting on monthly compensation, this year's update could mean more money in your pocket. But what does the projected 3.1% COLA increase really mean for you?

In this guide, you’ll discover:

• Exactly how much more you might receive by rating
• What 100% VA disability could pay in 2025
• How your benefits can unlock homeownership opportunities—even with no down payment

Let’s break it all down to help you plan smarter and maximize your benefits.

How is VA COLA calculated?

The Cost-of-Living Adjustment (COLA) is based on inflation data from the CPI-W index (Consumer Price Index for Urban Wage Earners and Clerical Workers).
The Social Security Administration evaluates this data each year in Q3, influencing the VA’s final rate adjustment.

Is VA disability enough to buy a home in 2025?

Yes, many veterans use their tax-free VA disability compensation to qualify for VA loans.
Because this income is considered stable and sufficient by lenders, it can often cover mortgage requirements—especially with no down payment or PMI.

Explore VA Home Loan Eligibility
Learn How VA Disability Supports Home Loans

Pros and Cons of Using VA Disability for a Mortgage

Note: Veterans with dependents (spouse, children, parents) may receive additional amounts. Updated figures will be available once the VA publishes official rates.

What Will 100% of VA Disability Pay in 2025?

For veterans with a 100% disability rating and no dependents, monthly compensation in 2025 is estimated at $3,853.74. Veterans with dependents (e.g., spouse and child) could receive more than $4,100 monthly, depending on their specific family situation.

Disability compensation is tax-free and may be considered qualifying income for a VA home loan.

Financial Planning Tips for 100% Disabled Veterans in 2025

While the projected increase can offer some relief, inflation may still outpace COLA adjustments. Consider these planning steps:

• Reevaluate your monthly budget with updated income estimates
• Track variable expenses such as utilities, prescriptions, and transportation
• Build an emergency fund to cover unexpected costs
• Explore how VA benefits may support long-term goals like homeownership.
  

VA Disability and Homeownership: What You Should Know?

Your disability compensation can help you qualify for a VA-backed mortgage. Here are several key advantages of VA loans for eligible veterans:

• No down payment required (subject to VA and lender guidelines)
• No private mortgage insurance (PMI)
• No VA funding fee for veterans with a service-connected disability rating of 10% or higher
• VA disability income is considered qualifying income, even if non-taxable.

Always confirm eligibility with a licensed VA mortgage specialist.

Ready to Buy? Consider a Commission-Free Option

Working with real estate agents traditionally involves buyer-side commissions. Platforms, such as reAlpha, offer commission-free options, potentially helping veterans reduce costs associated with home purchases.

Note: Veterans should perform due diligence and consult with qualified real estate and mortgage professionals before making homebuying decisions.

2025 Action Plan for 100% Disabled Veterans

• Monitor VA updates on finalized 2025 compensation rates
• Reassess your housing affordability with new income projections
• Connect with a VA loan expert to explore your purchasing power
• Research real estate options and commission-free platforms
• Consider locking in mortgage rates based on current market trends.
  
  

Frequently Asked Questions

The 2025 VA disability rates are projected to rise by 3.1%.
For example, a veteran with a 100% disability rating and no dependents may receive about $3,853/month, with additional pay for dependents.

Will VA disability increase in 2025?

Yes, VA disability pay is expected to increase in 2025 due to a 3.1% COLA adjustment.
This means higher monthly compensation for all rating levels.

How much is VA 100% disability in 2025?

A veteran rated 100% disabled with no dependents may receive $3,853/month in 2025. With dependents, it could exceed $4,100/month.

Is VA disability compensation considered income?

Yes, VA disability compensation is qualifying income—but it’s tax-free.
This makes it highly valuable when applying for a VA-backed home loan.

Do 100% disabled veterans pay the VA funding fee?

No. Veterans with a 10% or higher disability rating are exempt from the VA funding fee, saving thousands when purchasing a home.

Final Thoughts

Understanding your 2025 VA disability compensation is essential to maintaining your financial well-being. Whether you’re adjusting your budget or considering a home purchase, your benefits can help support greater stability.

Veterans deserve clear information and reliable support. Licensed professionals, like those at Be My Neighbour Mortgage (NMLS #1743790), are available to assist with VA loan education and pre-qualification.

Platforms such as reAlpha offer innovative home-buying solutions like commission-free homebuying, but veterans are encouraged to fully understand any terms or limitations before proceeding.

This content is for educational purposes only and complies with applicable mortgage lending regulations, including the SAFE Act. All financial decisions should be made with guidance from licensed professionals.

Be My Neighbour Mortgage
NMLS ID: 1743790
reAlpha – Commission-Free Real Estate Platform

This blog post does not constitute legal or financial advice. Please consult with licensed professionals regarding your specific circumstances.