VA Loan Funding Fees
Find the information you need to make a smart decision about your VA purchase loan or refinance.
Find the information you need to make a smart decision about your VA purchase loan or refinance.
The VA funding fee is part of the additional costs you may need to pay on a VA purchase loan or refinance. It’s unique to VA-backed or VA direct loans, but it helps ensure affordable homeownership for those who qualify for this type of financing.
The VA funding fee is a one-time payment that is paid by the borrower of the VA loan. Since the VA loan program doesn’t require down payments or monthly mortgage insurance, the VA funding fee is used to help lower the overall cost of the loan to the United States taxpayers.
VA funding fees for home purchases are based on a number of correlating factors specific to every situation. For home purchases the funding fee can range anywhere from 1.4-3.6% of the loan amount. The VA updates it’s terms often and we recommend contacting an experienced mortgage lender to determine what the fee would be in your specific situation.
Similar to funding fees for home purchases, VA refinance funding fees are specific to multiple factors. However, the VAs Interest Rate Reduction Refinancing Loans (IRRRLs) have a flat fee that is 0.5% of the loan amount. The VA updates it’s terms often and we recommend contacting an experienced mortgage lender to determine what the fee would be in your specific situation.
Under most circumstances the VA funding fee is paid by the buyer. However, it is possible through negotiation for the seller to pay the funding fee. If the buyer is paying the funding fee they also have the option of rolling it into the loan or paying it in full with a one-time payment.
Not everyone is required to pay the VA funding fee. Common exceptions include veterans who are eligible for compensation due to a service related injury, the surviving spouse of a veteran who died in service or due to a service-related disability. There are many other exceptions to the funding fee. You can visit the VAs website to see the full list of exemptions.
Robert S
Robert S“Our refinance experience with FFB was absolutely perfect. Their customer rep was superb — extremely knowledgeable and very responsive to our questions. Their online mortgage software was also exceptionally well designed. We have been through many refinances over the years, and this was one of the best!”
First Federal Bank does not charge a lender fee for VA loans under most circumstances.
The VA allows a veteran to hold multiple VA loans at the same time. Please contact us with your specific situation to see if this is an option for you.
Since VA loans are backed by the federal government they tend to be lower than conventional rates. FFB’s VA rates are typically lower than the national average as well.
Learn more about the VA funding fee and what you can expect to pay by clicking the link below, starting your application, and getting in touch with an experienced mortgage lender at FFB.
