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VA Loan Costs – What Is The VA Funding Fee?

  • The VA Funding Fee is a unique cost to VA Loans.

  • It is a one time fee paid as part of your closing costs on both VA Purchase Loans or VA Refinance loans.

  • The Funding Fee is a percentage of the loan amount.  The Percentage varies depending on the type of VA Home Loan and your military category, if you are a first time or subsequent user of the program, and whether you make a down-payment.

  • The VA Funding Fee goes directly to the VA to ensure that the VA loan program can maintain funding and will continue to be available for future generations.

  • The VA Funding Fee is used by the VA to offset the loss on loans that go into default, and thus reduce the cost to US Taxpayers to maintain the program.

  • Borrowers have the option to pay the Upfront Funding Fee at closing as part of their closing costs, or to roll it into the loan amount to keep the borrower’s cash-out-of-pocket lower.

I Am Disabled; Do I Need to Pay the VA Funding Fee?

  • VA Home Loan Borrowers with service-related disability can receive an exemption from the VA and may not have to pay the VA Funding Fee.

  • Disabled Veterans receiving VA compensation for a service-related disability do not have to pay the VA Funding Fee.

  • Disabled Veterans who would be entitled to receive compensation for a service related disability if they did not receive retirement or active duty pay.

  • Surviving Spouses whose partner died either in service or from a service related disability.

How Much is the VA Funding Fee a VA Funding Fee Calculator

As mentioned above, the VA Funding Fee is a one-time fee paid directly to the VA.

  • How much will your VA Funding Fee cost?

    • The answer depends on several factors.

    • Foundation Mortgage’s VA Funding Fee Calculator will help you determine how much you should expect to pay for your VA Funding Fee.

    • Remember that this fee can be rolled into your loan amount so you do not have to pay it out of pocket at closing.

You can also contact one of our VA Home Loan Specialists for help at 855-313-6066