The VA Funding Fee

What Is The VA Funding Fee?

The VA guarantees a certain percentage of the money mortgage companies borrower out as assurance the business will get their money back.  In order to cover this cost the VA charges the VA FUNDING FEE.  This is a percentage of every VA loan issued, the percentage is added onto the loan amount at close, and this money is allocated to the VA.  They use this money to pay out any foreclosure or short sale losses to the lending institution.  This is the money they use to “guarantee” their mortgages.

The VA Funding Fee Table:

Veteran Type Down Payment % for 1st Time Use % for Following Use
Regular Military None
5% or more
10% or more
2.15%
1.50%
1.25%
3.3% *
1.50%
1.25%
Reserves / National Guard None
5% or more
10% or more
2.4%
1.75%
1.5%
3.3% *
1.75%
1.5%

VA FUNDING FEE FOR CASH-OUT REFINANCING HOME LOANS

Type Of Veteran % for 1st Time Use % for Following Use
Regular Military 2.15% 3.3% *
Reserves / National Guard 2.4% 3.3% *

 

Type Of Loan Percentage for Either Type of Veteran Whether First Time or Subsequent Use
IRRRL .50%
Manufactured Home Loans (NOT permanently
affixed)
1.00%
Loan Assumptions .50%