Understand the VA funding fee before you compare loans

Current purchase funding-fee schedule

The VA funding-fee chart shown on VA.gov in October 2026 lists 2.15% for first use with less than 5% down, and 3.3% for later use with less than 5% down. For eligible transactions with down payments of at least 5% but less than 10%, the fee is generally 1.5%; with down payments of at least 10%, generally 1.25%. Exempt borrowers do not pay the funding fee.

Refinance funding fees are different

The VA Interest Rate Reduction Refinance Loan (IRRRL) fee is generally 0.5%. For VA-backed cash-out refinancing, the VA's published general first-use rate is 2.15%, and subsequent-use rate 3.3%, unless an exemption applies.

An example—not a loan quote

On an illustrative $300,000 loan amount, a 2.15% funding fee would be $6,450. At 3.3%, the illustrative fee would be $9,900. The actual calculation and financed amount depend on the borrower and transaction.

Who may be exempt?

VA lists several exemptions, including qualifying service-connected disability compensation recipients, certain qualifying surviving spouses, and some other groups. The VA determines exemption status. Do not assume that every veteran, or every veteran reporting a disability, qualifies automatically.

How you pay affects total cost

A funding fee may be paid at closing or, when permitted, financed into the mortgage. Financing increases the loan principal and may increase interest expense. A funding-fee exemption is separate from other closing charges, insurance premiums and escrow costs.

Compare the right numbers

• Check whether you are a first-time or subsequent user for the relevant fee category.
• Verify any applicable exemption documentation.
• Request a written Loan Estimate and review cash to close and total borrowing costs.
• Do not mistake zero down payment for zero money needed at closing.

Official VA reference

VA: Funding fees and closing costs ↗