How much is the VA funding fee?

For purchase loans: 2.15% first use with less than 5% down, 1.5% with 5-9.99% down, and 1.25% with 10% or more down. Subsequent use is 3.3% with less than 5% down. VA IRRRL streamline refinances are 0.5%.

Can the VA funding fee be rolled into the loan?

Yes. The fee can be financed into the loan amount so it is not due in cash at closing, or a seller may pay it as part of concessions.

Is the VA funding fee refundable?

Yes, if the VA later grants a disability rating with an effective date before your loan closing, you may be entitled to a refund of the funding fee you paid.

Does the funding fee replace mortgage insurance?

Effectively, yes. The one-time fee funds the VA guaranty program, which is why VA loans never carry monthly PMI, even with zero down.

Can the seller pay my VA funding fee?

Yes. The funding fee can be paid by the seller as part of the 4% concession allowance, paid in cash by the buyer, or financed into the loan amount. Financing it is the most common choice because it keeps cash to close near zero.

Do I get a refund if my disability rating comes through after closing?

Often yes. If VA later grants compensation with an effective date before your closing date, you can request a refund of the funding fee you paid. Contact your servicer and the VA regional loan center with the rating decision.

VA Loan Guide

VA Loan Funding Fee Explained

Q: Who is exempt from the VA funding fee?

Veterans receiving (or entitled to receive) VA compensation for a service-connected disability, active-duty Purple Heart recipients, and surviving spouses receiving Dependency and Indemnity Compensation are exempt. Exemption is confirmed on your Certificate of Eligibility.

Q: Who is exempt from the VA funding fee?

Veterans receiving VA compensation for a service-connected disability, veterans rated eligible to receive compensation from a pre-discharge exam, surviving spouses of veterans who died in service or from a service-connected disability, and active-duty Purple Heart recipients are all exempt. Exempt status is confirmed on the Certificate of Eligibility.

Understand VA funding fee rates, exemptions, and payment options for purchase and refinance loans

✓Veteran-Owned

✓Top 1% Nationwide

✓2,500+ Families Served

Overview

What is the VA Funding Fee?

The VA funding fee is a one-time payment that helps sustain the VA loan program for future generations of Veterans. Unlike private mortgage insurance (PMI), the funding fee is paid once and can be financed into your loan.

This fee helps offset the cost of the VA loan program to taxpayers, ensuring the program remains self-sustaining and available for all eligible Veterans and service members.

Can Be Financed

Roll the fee into your loan—no upfront cash required

One-Time Payment

Unlike PMI, you pay it once, not every month

Many Are Exempt

Disabled Veterans and survivors pay no funding fee

VA Funding Fee Rates (Purchase Loans)

Down Payment	First-Time Use	Subsequent Use
0%	2.15%	3.30%
5-9%	1.50%	1.50%
10%+	1.25%	1.25%

Example Calculation

Scenario: $400,000 loan, first-time use, 0% down
Funding Fee: $400,000 × 2.15% = $8,600
Total Loan Amount: $408,600 (if financed)

Refinance Funding Fee Rates

Loan Type	Funding Fee
IRRRL (Streamline)	0.50%
Cash-Out Refinance (First Use)	2.15%
Cash-Out Refinance (Subsequent)	3.30%

Learn more about VA refinance options.

Who is Exempt from the VA Funding Fee?

Veterans receiving VA disability compensation
Veterans rated for disability but receiving retirement pay instead
Veterans eligible for disability but waived benefits to receive active duty pay
Surviving spouses of Veterans who died in service or from service-connected disabilities

How to Claim Your Exemption

Provide your VA disability rating documentation to your lender during the loan application. The exemption is automatic once verified. Even a 0% disability rating qualifies.

Calculate Your VA Funding Fee

Use our calculator to estimate your funding fee and total loan costs