Calculate your VA loan funding fee instantly with our free calculator. Discover how your down payment, service type, and prior VA loan use impact your total mortgage costs. Plan your home purchase or refinance today.
VA Funding Fee Calculator
What is the purpose of the VA loan funding fee?
The VA funding fee is a one-time payment made to the Department of Veterans Affairs. Its primary purpose is to help lower the overall cost of the VA home loan program for U.S. taxpayers. Because VA loans typically do not require a down payment or monthly private mortgage insurance (PMI), this fee helps sustain the program and keep it running for future generations of Veterans.
How is the funding fee percentage calculated?
The VA funding fee percentage is calculated based on several specific factors regarding your loan profile:
- Loan Type: Whether the loan is a purchase, construction loan, cash-out refinance, or an Interest Rate Reduction Refinance Loan (IRRRL).
- Down Payment Amount: Bringing a down payment of 5% or more significantly lowers the fee.
- Usage History: Whether it is your first time using a VA loan or a subsequent use.
Who qualifies for a complete funding fee exemption?
The following individuals are completely exempt from paying the VA funding fee:
- Veterans receiving VA compensation for a service-connected disability.
- Veterans entitled to receive VA compensation but who are receiving retirement or active-duty pay instead.
- Surviving spouses of Veterans who died in the line of duty or from a service-connected disability.
- Active-duty service members who have been awarded the Purple Heart.
Does making a larger down payment reduce the fee amount?
Yes, making a larger down payment significantly reduces the funding fee for purchase and construction loans. Here is how the down payment affects the rate for standard VA loans:
| Down Payment | First Use | Subsequent Use |
|---|---|---|
| Less than 5% | 2.15% | 3.30% |
| 5% to 9.99% | 1.50% | 1.50% |
| 10% or more | 1.25% | 1.25% |
Can the funding fee be financed into the total loan balance?
Yes, borrowers have the flexibility to finance the VA funding fee by rolling it into the total loan amount, rather than paying it entirely out of pocket at closing. While this reduces upfront closing costs, it does increase the overall monthly mortgage payment and the total amount of interest paid over the life of the loan. Alternatively, borrowers can choose to pay the fee in full in cash at closing.
Does the fee increase if I use a VA loan more than once?
Yes, but only if you put down less than 5%. For a home purchase with zero down payment, the fee jumps from 2.15% for your first use to 3.30% for subsequent uses. However, if you make a down payment of 5% or more, the funding fee percentage drops and remains exactly the same, regardless of whether it is your first time or a subsequent use.
How do service-connected disabilities impact the fee?
Service-connected disabilities provide a massive benefit regarding the VA funding fee. If a Veteran is receiving VA disability compensation for a service-connected injury or illness, they are completely exempt from paying the funding fee. This exemption saves disabled Veterans thousands of dollars in closing costs or financed loan balances. You will need your Certificate of Eligibility (COE) to verify this exempt status.
Do eligible surviving spouses have to pay the funding fee?
No. Eligible surviving spouses of Veterans who died in the line of duty or as a result of a service-connected disability are granted the exact same fee exemption as disabled Veterans. If a surviving spouse qualifies for a VA home loan, the funding fee is entirely waived.
Is it possible to receive a refund for the funding fee later?
Yes, a refund is possible, but it usually depends on the timing of a VA disability claim. If a Veteran is awarded VA disability compensation and the retroactive effective date of the disability is prior to the closing date of their VA loan, the Veteran is entitled to a full refund of the funding fee. You can contact your mortgage servicer or the VA regional loan center to initiate this process.
Are funding fees required for VA refinance loans?
Yes, funding fees apply to refinances, but the rates differ depending on the type of refinance you are pursuing:
| Refinance Type | Funding Fee Percentage |
|---|---|
| Interest Rate Reduction Refinance Loan (IRRRL) | 0.50% (Flat rate for all uses) |
| Cash-Out Refinance (First Use) | 2.15% |
| Cash-Out Refinance (Subsequent Use) | 3.30% |
Note: Fee exemptions for disabled Veterans and eligible surviving spouses still apply to all refinance loans.
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