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VA Funding Fee
A funding fee of 2.0 percent of the principal loan amount must be
paid to VA by all but certain exempt veterans. A down payment of 5 percent
or more will reduce the fee to 1.5 percent and a 10 percent down payment
will reduce it to 1.25 percent. We are now offering a second
trust program specifically to reduce the funding fee required instead
of the down payment required to reduce the funding fee.
A funding fee of 2.75 percent must be paid by all eligible
Reserve/National Guard individuals. A down payment of 5 percent or more
will reduce the fee to 2.25 percent and a 10 percent down payment will
reduce it to 2.0 percent.
The funding fee for loans to refinance an existing VA home loan with a
new VA home loan to lower the existing interest rate is 0.5 percent.
Veterans who are using entitlement for a second or subsequent time who
do not make a down payment of at least 5 percent are charged a funding fee
of 3 percent.
For all VA home loans, the funding fee may be paid in cash at closing or it
may be included in the loan.
Other Closing Costs
Reasonable closing costs may be charged by the lender. These costs may
not be included in the loan. The following items may be paid by the
veteran purchaser, the seller, or shared. Closing costs may vary among
lenders and also throughout the nation because of differing local laws and
customs.
- VA appraisal
- Credit report
- Loan origination fee (usually 1 percent of the loan is charged by
most lenders. I do not charge origination fees)
- Discount points
- Title search and title insurance
- Recording fees
- State and/or local transfer taxes, if applicable
- Survey
No commissions, brokerage fees, or "buyer broker" fees may be
charged to the veteran buyer.
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