VA Funding Fee
The VA funding fee is collected at closing on VA purchase and refinance loans. The funding fee can be waived if VA disability requirements are met.
VA funding fees can be paid out of pocket at closing but are typically financed into the VA loan.
VA Funding Fee Waiver
Veterans with service related disability rating of 10% or greater are exempt from the VA funding fee. The waiver is indicated on the veterans Certificate of Eligibility (COE).
VA Purchase Loan Funding Fee
VA loans with down payments of less than 5% have one of two possible funding fees. Using VA home loan benefits for the first time results in a funding fee of 2.15% of the VA base loan amount, which is purchase price less any down payment. If the VA borrower has previously had a VA loan, the funding fee is 3.3% of the base VA loan amount.
Down Payment Greater than 5% but Less than 10%
The VA funding fee is reduced to 1.5% of the base loan amount regardless of first-time or subsequent use of VA home loan benefits.
Down Payment of 10% or Greater
When making a 10% or greater down payment, the VA funding fee is 1.25% of the base VA loan amount for all non-exempt VA loan borrowers.
VA Refinance Funding Fee
The same disability waiver rules apply to VA refinance loans.
Interest Rate Reduction Refinance Loan (IRRRL)
When streamline a VA refinance using an IRRRL, the VA funding fee is 0.50% of the new VA loan amount.
All Other VA Refinance Loans
Traditional, non-IRRRL VA refinance loans funding fees mirror the no down payment purchase loan funding fees. 2.15% for first-time users and 3.3% for subsequent-use VA borrowers.