The VA funding fee 2026 rate chart shows fees from 1.25% to 3.3% of your loan amount depending on down payment and whether it is your first VA loan. The scenario most veterans ask about first: a first-time purchase with $0 down costs 2.15% — on a $350,000 loan, that is $7,525, usually rolled into the mortgage rather than paid at closing. Subsequent use with no down payment jumps to 3.3%. Put 5% down and the fee drops to 1.5%; put 10% or more down and it falls to 1.25% regardless of first or subsequent use. This guide breaks down every tier, who pays nothing, and how to calculate your exact dollar amount before you apply.
What the VA Funding Fee Actually Pays For
The VA funding fee is a one-time charge on VA-backed and VA direct home loans. It is not private mortgage insurance, not a down payment, and not a lender junk fee — it is the cost of sustaining the VA home loan program so future veterans can access the same benefit.
Because the VA guarantee lets lenders offer $0 down and no monthly PMI, the program would strain taxpayer resources without a funding mechanism. The fee you pay on your loan helps offset that cost. In exchange, eligible veterans access one of the most borrower-friendly mortgage products available — no monthly mortgage insurance, competitive rates, and flexible qualification standards. For the full benefit overview, see our VA loan benefits guide.
2026 VA Funding Fee Rate Chart
The rates below reflect the official VA funding fee table for purchase and construction loans (Veterans, active-duty members, and National Guard/Reserve members). Fees are calculated as a percentage of the loan amount — not the purchase price. Down payment tiers apply to purchase loans only; refinance and specialty loan types use flat rates.
Purchase Loan Rates by Down Payment
| Down Payment | First-Time Use | Subsequent Use |
|---|---|---|
| Less than 5% | 2.15% | 3.3% |
| 5% or more | 1.5% | 1.5% |
| 10% or more | 1.25% | 1.25% |
Other VA Loan Types
| Loan Type | VA Funding Fee |
|---|---|
| Interest Rate Reduction Refinance (IRRRL) | 0.5% |
| Cash-out refinance — first use | 2.15% |
| Cash-out refinance — subsequent use | 3.3% |
| Manufactured home (not permanently affixed) | 1.0% |
| Loan assumption | 0.5% |
| Vendee loan (VA-acquired property) | 2.25% |
Rates verified against the official VA.gov funding fee table (effective April 7, 2023; page last updated January 15, 2026). VA funding fee rates can change by federal policy — confirm current figures at va.gov/housing-assistance/home-loans/funding-fee-and-closing-costs before locking your loan. MortgageCalculatorIQ provides educational estimates only; your lender's Loan Estimate is the binding document.
Key Statistics
Most common rate (first-time, $0 down)
2.15%
Subsequent use, $0 down
3.3%
IRRRL (streamline refi) flat rate
0.5%
Fee at 10%+ down (any use)
1.25%
Calculate Your Exact Funding Fee
Dollar amounts matter more than percentages when you are budgeting for closing. On a $350,000 home with $0 down, a 2.15% first-time funding fee equals $7,525 added to your loan balance. Toggle exemption status, down payment, and first-time vs. subsequent use in the calculator below to see your exact fee and monthly payment impact. For a standalone run, use our full VA loan calculator.
Try it yourself — adjust the numbers below
Check Your VA Loan Eligibility
✅ You likely qualify for a VA loan
Based on your service profile you meet the basic eligibility requirements.
Get Your COE →Your Home
Loan Terms
VA loans typically offer 0.5–0.75% lower rates than conventional
VA Funding Fee
VA Funding Fee
0% down · First use · Regular Military
$7,525
2.15% of loan amount
Reduce your funding fee by increasing your down payment:
0–4.9%
2.30% fee
$8,050
5–9.9%
1.65% fee
$5,486
10%+
1.40% fee
$4,410
Your current tier is highlighted
Monthly Payment
$2,603.97
$456,003
Funding Fee
$7,525
PMI Savings vs Conventional
$227/mo
VA Loan Monthly Payment
You save $227/month vs a conventional loan with 5% down
Over 7 years that's $19,086 in PMI savings · Over the life of the loan: $81,795
Who Is Exempt
A VA funding fee exemption is one of the most valuable — and most overlooked — benefits in the program. You pay $0 if any of the following apply:
- You receive VA compensation for a service-connected disability
- You are eligible for VA compensation but receive retirement or active-duty pay instead
- You receive Dependency and Indemnity Compensation (DIC) as a surviving spouse
- You have a proposed or memorandum disability rating before closing from a pre-discharge claim
- You are an active-duty service member who received a Purple Heart on or before your loan closing date
If you think you may qualify but have not yet received a rating, apply for your Certificate of Eligibility and discuss timing with a VA-approved lender. A retroactive disability award after closing can qualify you for a funding fee refund — but only if the effective date of compensation predates your loan closing. See the FAQ below for refund details.
How to Lower Your Fee Without an Exemption
If you do not qualify for a VA funding fee exemption, you still have levers to reduce the percentage — and the seller can cover the cost entirely.
Put 5% or 10% Down
Even though VA loans allow $0 down, putting 5% down drops the fee from 2.15% to 1.5% on a first-time purchase. Ten percent down lowers it further to 1.25% — the lowest purchase rate regardless of first or subsequent use. On a $350,000 loan, that is the difference between $7,525 and $4,375 in funding fees.
Ask the Seller to Pay
VA allows seller concessions up to 4% of the home's reasonable value, and the funding fee is an allowable concession. In buyer-friendly markets, sellers may credit your fee at closing — effectively a VA funding fee exemption funded by the seller rather than the VA.
Use Your Benefit Strategically
First-time use rates are lower than subsequent use at the same down payment tier. If you have used your benefit before, restoring full entitlement by paying off a prior VA loan resets you to first-time rates on your next purchase.
Is the VA Funding Fee Tax Deductible?
The VA funding fee may be tax deductible as mortgage interest in the year you pay it — whether you pay upfront at closing or finance it into the loan. If financed, the deductible portion is generally spread over the life of the loan as you pay interest on the fee amount. Tax rules change, and deductibility depends on whether you itemize and your overall tax situation.
This is not tax advice. Consult a qualified tax professional about your specific circumstances. For context on how VA loans compare on ongoing monthly costs — including the fact that VA loans have no PMI — see our VA vs conventional comparison.
Financing the Fee vs. Paying Cash
You have two payment options at closing: pay the full funding fee upfront, or roll it into your loan balance (financing). Most veterans choose to finance because it preserves cash for moving expenses, emergency reserves, and immediate home repairs.
Financing adds the fee to your principal, which means you pay interest on it over the loan term — a $7,525 fee financed at 6.5% over 30 years adds roughly $47 per month and about $9,500 in total interest. Paying cash avoids that interest cost but requires liquid funds at closing. Run both scenarios in the calculator above or use our monthly payment calculator to compare total housing costs.
How VA Loans Compare Without Monthly Mortgage Insurance
Conventional borrowers putting less than 20% down pay PMI — typically $150 to $250 per month on a $350,000 home — until they reach 20% equity. FHA borrowers pay mortgage insurance for the life of the loan in most cases. VA loans have no monthly mortgage insurance ever. The one-time funding fee replaces that ongoing cost.
Even after accounting for the funding fee, VA loans often save thousands over the first seven years compared to conventional financing with PMI. On a $350,000 purchase, avoiding PMI alone can save $12,000 or more in that period — often exceeding the upfront funding fee within the first few years. Our VA loan benefits guide walks through the full dollar comparison, and the VA vs conventional breakdown puts the numbers side by side.
| Cost | VA Loan ($0 down) | Conventional (5% down) |
|---|---|---|
| Upfront fee / PMI setup | $7,525 funding fee (financed) | $0 upfront PMI |
| Monthly insurance | $0 PMI | ~$175/mo PMI |
| 7-year insurance/fee cost | ~$7,525 + interest | ~$14,700 PMI |
Key Takeaway
The VA funding fee 2026 is the price of access to zero-down, no-PMI financing — and for most veterans, it pays for itself quickly. Calculate your exact fee with the tool above, check whether you qualify for an exemption, and compare your total cost on our VA loan calculator before you apply.