The VA Funding Fee
The VA mortgage provides veterans with a no down payment option to purchase a single-family residence, condominium or townhouse. Veterans who take advantage of this benefit will contribute to the loan program by paying the VA funding fee. The fee is a percent of the total loan amount and it varies depending on how many times you have used your entitlement, the type of service you performed and the loan type .
The current VA funding fee schedule is as follows
· First time use: 2.15%
· Consecutive use: 3.3%
· VA IRRRL: .5%
· Disabled Veterans: Varies depending upon circumstances
VA Funding Fee Exemptions
While the VA funding fee is a guideline requirement, the following borrowers are exempt from paying the fee.
· Veterans who received service-related disabilities and are receiving VA compensation.
· Veterans who would be able to be compensated for service-related disabilities if they had not taken retirement pay.
· Spouses of veterans who died while serving or because of service-related injuries.
Making the Funding Fee Affordable
If you have limited money for the purchase of your home, one of the benefits of the VA loan program is the ability to add the funding fee to the principal loan amount. The funding fee can be added to the total loan amount rather than part of the total closing costs, making the VA loan’s closing costs even more affordable.
Our VA loan specialists are here to assist you in understanding the loan process. To find out how much the funding fee will be for the loan you need or to start your VA mortgage application, please contact one of our community bankers today!