COSTS OF OBTAINING A VA LOAN

COSTS OF OBTAINING A VA LOAN

Funding Fee

• A funding fee must be paid by all veterans, except those exempt due to receipt of disability compensation, using the VA home loan program.
• The funding fee can range from 0.5 percent for Interest Rate Reduction Refinancing Loans (IRRRL) to 3.3 percent for veterans who are subsequent users of the VA home loan program.
• For all VA loans, the funding fee may be paid in cash or included in the loan.
• For more information on the VA funding fee, contact the nearest VA office.

Other Closing Costs

Reasonable closing costs may be charged by the lender. These costs may not be included in the loan. The following items may be paid by the veteran purchaser, the seller, or shared. Closing costs may vary among lenders and also throughout the nation because of differing local laws and customs.

• VA appraisal
• Credit report
• Loan origination fee (usually 1 percent of the loan)
• Discount points
• Title search and title insurance
• Recording fees
• State and/or local transfer taxes, if applicable

Remember, VA-guaranteed financing is a benefit which Congress intended eligible veterans should have. If you are a veteran home buyer or know of one, it makes sense to look into the VA loan program as a good way to finance a home purchase.