The VA Funding Fee is a fee charged on all non-exempt VA home loans to help defray costs of the VA loan program. The VA Funding Fee is charged by the Veterans Administration (VA) and not the lender. Congress first implemented the fee as a flat percentage on all VA home loans. The current VA Funding Fee levels range from .5% to 3.3% of the total loan amount, and may be financed into the loan. Over time, the VA funding fee was adjusted based on the type of loan (purchase or refinance) and whether or not there was an optional downpayment (and how much). The fee is also adjusted depending upon whether the service member or Veteran is using the benefit for the first time, or any number of subsequent times. Veterans who have a service-connected disability rating from the VA of 10% or more are exempt from the funding fee. If you have a service-connected disability or are currently pursuing a disability rating with the VA, you may be eligible to waive the funding fee!
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