The VA funding fee helps keep the VA home loan program running at no cost to taxpayers, and it is one of the main costs of a VA loan. The good news is that it can be added to the loan, and some people do not owe it. According to the VA, you are exempt in these cases:
- You receive VA compensation for a service-connected disability.
- You are eligible to receive that compensation but receive retirement or active-duty pay instead.
- You are a surviving spouse of a veteran, receiving Dependency and Indemnity Compensation (D.I.C.).
- You are a service member with a proposed or memorandum rating, issued before the loan closing date, tied to a pre-discharge disability claim.
- You are an active-duty member who provides evidence that you received a Purple Heart on or before closing.
Read the VA's own list and the fee table here: VA: funding fee and closing costs. Whether you qualify depends on your records, so your lender and the VA can confirm.
What else you pay at closing
The VA says you can include the funding fee in the loan and pay it over time, or pay it at closing. Other costs on a purchase are paid when you close, and who pays each one can be negotiated between the buyer and seller. The VA lists the common ones: real estate commissions and fees, loan origination fee and discount points, credit report charges, the VA appraisal fee, hazard insurance and property taxes, state and local taxes, title insurance and the recording fee.
See your numbers
Try the VA Funding Fee Calculator: choose "exempt" to see the payment without the fee, or add the fee to the loan to compare.
Talk to a lender. Rates, loan programs and approvals come from lenders, not from websites or real estate agents. Talk to your own mortgage broker, or use our preferred lender, Point Mortgage Corporation (NMLS #231073), at (619) 475-4095. You are always free to choose any lender you like, and you can verify any lender’s license at nmlsconsumeraccess.org.
General information, not legal, tax or lending advice. Programs, rules and rates change, so confirm current details with the official source, your lender and your advisors.
More guides
- VA Loan or Conventional Loan? How to Compare Them — A fair, side-by-side way to compare a VA loan with a conventional loan, and the numbers that matter most.
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