VA Loan Funding Fee: Who is exempt?

A VA Loan is a benefit for military service provided to eligible veterans, service members, and surviving spouses. 

The majority of veterans who buy or refinance a home with a VA Loan have to pay a one-time funding fee. This fee is in place to protect the VA Loan program when mortgages default. 

The amount you pay is dependent on the type of VA Loan you’re getting and how much money you are borrowing, along with other factors. You have the option to pay your funding fee at closing or you can add the price into your mortgage and pay it over time. Keep in mind that financing your funding fee into your loan will likely increase your monthly payment and the total amount of money you pay in interest over the lifetime of your loan. 

Veterans who are eligible to receive compensation for a service-related disability may be exempt from paying the funding fee. The surviving spouses of veterans who died in service may also be exempt from paying the fee. 

VA Loan borrowers with full entitlement don’t have a limit on how much they can borrow with a 0% down payment. This includes any amount. Even over the conforming limit of $647,200, the veteran can still finance up to 100% of the value of the property. 

VA Loan entitlement refers to the amount the government will guarantee to your lender if you default on your loan. A great benefit of choosing a VA Loan is that you don’t have to make a down payment. The VA entitlement amount will advise you on the maximum amount you can borrow without having to put any money down. 

If you’ve never gotten a VA Loan or you’ve paid off a previous loan in full and sold the property the loan was used to purchase, you should be eligible for full entitlement. 

With Georgia Platinum Mortgage, your VA Loan can close in less than 30 days. Reach out to one of our Loan Advisors today to determine if a VA Loan is right for you!