The VA requires a VA funding fee as a way of passing on the benefits of the VA loan to other veteran borrowers. Unless the veteran has a disability rating of 10% or more through the VA, they will be charged a VA funding fee when considering a VA loan. The amount of the fee varies depending of several conditions. These conditions include:
- Whether your a purchasing, refinancing, or cashing out some equity
- Whether your are regular military or Reserves/National Guard
- Whether this is your first time utilizing your VA home loan benefits or its a subsequent use
Purchase And Construction Loans |
|||
| Type of Veteran | Down Payment | First Time Use | Subsequent Use for loans from 1/1/04 to 9/30/2011 |
|---|---|---|---|
| Regular Military | None 5% or more (up to 10%) 10% or more | 2.15% 1.50% 1.25% |
3.3%* 1.50% 1.25% |
| Reserves/National Guard | None 5% or more (up to 10%) 10% or more | 2.4% 1.75% 1.5% |
3.3%* 1.750% 1.5% |
Cash-Out Refinancing Loans |
|||
| Type of Veteran | Percentage for First Time Use | Percentage for Subsequent Use | |
| Regular Military | 2.15% | 3.3% * | |
| Reserves/National Guard | 2.4% | 3.3% * | |
| * The higher subsequent use fee does not apply to these types of loans if the veteran’s only prior use of entitlement was for a manufactured home loan. | |||
Cash-Out Refinancing Loans |
|||
| Type of Veteran | Percentage for Either Type of Veteran Whether First Time or Subsequent Use | ||
| Interest Rate Reduction Refinancing Loans | .50% | ||
| Manufactured Home Loans | 1.00% | ||
| Loan Assumptions | .50% |
The VA Funding Fee Chart can be located on the Department of Veteran Affairs website.
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