Funding Fees

Get acquainted with the home mortgage process before embarking on your house-hunting journey.

Explaining the VA Funding Fee:

The VA Funding Fee is a direct payment to the Department of Veteran's Affairs, enabling them to guarantee the no-money-down loan program. This fee facilitates VA eligible borrowers in enjoying loan benefits such as $0 down financing and exemption from mortgage insurance (PMI) payments.

Understanding the VA Funding Fee Chart:

The Funding Fee is determined based on four factors: Loan type (Purchase or Refinance), type of service, down payment (if any), and prior VA loan use. Refer to the charts below to ascertain your VA Funding Fee amount.

Purchase - First Time Use:

• Down Payment
• Less than 5% Down: Active Duty/Retired - 2.3%, Guard/Reserve - 2.3%
• 5-10% Down: Active Duty/Retired - 1.65%, Guard/Reserve - 1.65%
• 10% or More: Active Duty/Retired - 1.4%, Guard/Reserve - 1.40%

Purchase - Additional Use:

• Down Payment
• Less than 5% Down: Active Duty/Retired - 3.6%, Guard/Reserve - 3.6%
• 5-10% Down: Active Duty/Retired - 1.65%, Guard/Reserve - 1.65%
• 10% or More: Active Duty/Retired - 1.4%, Guard/Reserve - 1.40%

Cashout Refinance:

• VA Usage
  • 1st Time Use: Active Duty/Retired - 2.3%, Guard/Reserve - 2.3%
  • Additional Use: Active Duty/Retired - 3.6%, Guard/Reserve - 3.6%

IRRL (Interest Rate Reduction Loan):

• VA Usage
  • 1st Time Use: Active Duty/Retired - 0.5%, Guard/Reserve - 0.5%
  • Additional Use: Active Duty/Retired - 0.5%, Guard/Reserve - 0.5%

How the Funding Fee is Paid:

The VA Funding Fee is typically rolled into the loan but can also be paid by the seller or the borrower at the closing table.

Additional Details on VA IRRL:

A VA IRRL is a refinance of an existing VA mortgage. If you're refinancing from a non-VA loan type, standard underwriting guidelines, funding fees, appraisal requirements, and termite inspection apply.

VA Funding Fee Exemption:

Borrowers are exempt from the funding fee if they receive disability payments from the VA or are considered at least 10% disabled.

For More Information, Call 619-264-5611:

If you have inquiries about your VA loan benefit, the Funding Fee, Funding Fee Exemptions, or understanding the VA Funding Fee chart, please contact Bill Marshall.