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I am the author of this blog and also a top-producing Loan Officer and CEO of InstaMortgage Inc, the fastest-growing mortgage company in America. All the advice is based on my experience of helping thousands of homebuyers and homeowners. We are a mortgage company and will help you with all your mortgage needs. Unlike lead generation websites, we do not sell your information to multiple lenders or third-party companies.

VA Loan Funding Fees have been reduced for 2023 loans. The new funding fee applies to loans closing on or after April 7, 2023. Reduced funding fees apply to loans made to purchase or construct a dwelling with a Downpayment of five percent or more of the purchase price.

VA Loan Funding Fees


What kind of Downpayment is Required for VA Loans?

If you qualify, you can get a VA loan with no down payment. Even the funding fee is added to the loan amount on top of the 100% loan with a 0% down payment. The new reduced funding fees, however, apply to a 5% or more down payment.

How do I pay the VA Funding Fee?

The funding fee can be paid by you and added to your cash to close, or you can have the funding fee added to your loan amount. So, if you are borrowing $300,000 and your funding fee is $6,450 (calculated at 2.15% for first use with less than 5% downpayment), then your total loan amount will be the base loan amount of $300,000 + funding fee of $6,450 = $306,450.

Who is exempt from Paying VA Loan Funding Fees?

According to the Va.gov website,

You won’t have to pay a VA funding fee if any of these descriptions are true for you:

  • You’re receiving VA compensation for a service-connected disability, or
  • You’re eligible to receive VA compensation for a service-connected disability, but you’re receiving retirement or active-duty pay instead, or
  • You’re receiving Dependency and Indemnity Compensation (DIC) as the surviving spouse of a Veteran, or
  • You’re a service member who has received a proposed or memorandum rating before the loan closing date that says you’re eligible to get compensation because of a pre-discharge claim, or
  • You’re a service member on active duty who, before or on the loan closing date, provides evidence of having received the Purple Heart

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