The VA Funding Fee is charged to non exempt veterans on their opens in a new windowhome loan. The fee helps insure the VA home loan program and typically is financed into the veteran’s VA loan amount.
Phone: 602.435.2149
Email: Team@JeremyHouse.com
VA Funding Fee – Mortgage
A Funding Fee is an insurance premium charged to most veterans who use a VA home loan. In fact this fee is charged on the following VA mortgage transactions:
- Purchase
- Cash out refinance
- VA Streamline (IRRRL)
- Loan Assumption (VA to VA)
The table below lists out what the funding fee rate is for each different home loan transaction. These rates are effective April 7, 2023.
Above all, the VA home loan program remains solvent and available to veterans. This fee is in essence, serves the same purpose as what other loan types call “mortgage insurance” does. Therefore, the funding fee helps protect lenders in the event of a loan default.
Phone: 602.435.2149
Email: Team@JeremyHouse.com
How Much is it?
Specifically, the amount charged to a veteran depends on several factors. In fact, the following factors impact the funding fee:
- Level of military service
- Transaction type (purchase or refinance)
- Number of uses of VA loan
- Disability status with VA
- Down payment amount
Veterans Who Are Exempt From The Fee
In addition to the rates listed in the above Fee Rate Table, veterans rated as disabled are exempt from the funding fee. In other words, a 0% fee is charged to exempt veterans in all VA home loan transactions and scenarios.
Refer to the VA Rate Chart below to see what your fee would be.
New VA Funding Fee Rates
| VA Loan Type | Down Payment | Funding Fee First Time Use | Funding Fee Subsequent Use |
|---|---|---|---|
| Purchase | 0% | 2.15% | 3.3% |
| Purchase | 5% to 9.99% | 1.5% | 1.5% |
| Purchase | 10% or more | 1.25% | 1.25% |
| Cash Out Refinance | N/A | 2.15% | 3.3% |
| VA Streanline (IRRRL) | N/A | .5% | .5% |
| Loan Assumption | N/A | .5% | .5% |
Phone: 602.435.2149
Email: Team@JeremyHouse.com
Sample Funding Fee Calculation
Determining your VA Funding fee total is simple. In fact, it takes just 3 steps to figure the total cost of your VA Funding Fee.
- VA Base Loan Amount
Firstly, determine your VA Loan amount. Whether on a purchase, cash out refinance or VA Streamline (IRRRL), figuring out your loan amount is step 1.
- VA Funding Fee
After that, determine your Rate. Exempt veterans use 0% as your funding fee rate.
- Do the Math
After that, simply multiply your VA base loan (step 1) amount by your Funding Fee Rate (step 2). For example:
$450,000 (VA base loan) X 2.15% (Rate) = $9,675 VA Funding Fee Total
How The Fee Is Paid
Most commonly, veterans pay the fee by financing it into their VA home loan. However, the following options are also available:
- Finance fee into VA loan
- Veteran pays cash for fee
- Seller (on purchase transactions) pays for fee
- Lender pays for fee
Team Phone: 602.435.2149
Team Email: Team@JeremyHouse.com