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VA Funding Fee 2026: Rates, Exemptions and Refunds
For a first-time VA purchase loan with less than 5% down, the funding fee is 2.15% of the loan amount; for later uses it is 3.3%. Putting 5% or more down lowers it to 1.5%, and 10% or more lowers it to 1.25%. Veterans receiving VA disability compensation, and some others, are exempt. The fee can be rolled into the loan.
2026 VA funding fee rates
These rates apply to VA loans closed from April 7, 2023 through June 8, 2034, under current law.
Purchase or construction loans
| Down payment | First use | After first use |
|---|---|---|
| Less than 5% | 2.15% | 3.3% |
| 5% or more | 1.5% | 1.5% |
| 10% or more | 1.25% | 1.25% |
Other VA loans
| Loan type | Funding fee |
|---|---|
| Cash-out refinance | 2.15% first use; 3.3% after first use |
| Interest Rate Reduction Refinance Loan (IRRRL) | 0.5% |
| Loan assumption | 0.5% |
| Manufactured home (not permanently affixed) | 1.0% |
| Native American Direct Loan | 1.25% purchase; 0.5% refinance |
What it costs in dollars
On a $550,000 purchase with no down payment, a first-time user’s fee is 2.15%, or $11,825. With 10% down ($55,000), the loan is $495,000 and the fee drops to 1.25%, or $6,187.50. A veteran who is exempt pays neither.
Who does not pay the funding fee
- Veterans receiving VA compensation for a service-connected disability.
- Veterans entitled to that compensation who are receiving retirement or active-duty pay instead.
- Surviving spouses receiving Dependency and Indemnity Compensation (DIC).
- Service members with a proposed or memorandum disability rating issued before closing.
- Active-duty service members who provide proof of a Purple Heart on or before closing.
Your Certificate of Eligibility shows whether VA has you as exempt. If it looks wrong, sort it out with your lender before closing.
Can you finance it, and can you get it back?
You can pay the fee at closing or roll it into the loan. On a VA purchase loan it is the only closing cost that can be financed.
If VA later awards disability compensation with an effective date before your loan closed, you may be due a refund. VA sends refunds directly to the veteran. A pre-discharge rating does not qualify for a refund. VA’s Regional Loan Center can be reached at 877-827-3702.
Nevada County tip
Veterans with a pending disability claim should tell their lender early. Timing of the rating can change whether the fee applies, and on a foothill-priced home the difference is thousands of dollars.
Frequently asked questions
What is the VA funding fee in 2026?
For purchase loans it is 2.15% for first use and 3.3% for later use with less than 5% down, 1.5% with 5% or more down, and 1.25% with 10% or more down.
Who is exempt from the VA funding fee?
Veterans receiving VA disability compensation or entitled to it, surviving spouses receiving DIC, service members with a pre-discharge rating before closing, and active-duty Purple Heart recipients.
Can I roll the VA funding fee into my loan?
Yes. The funding fee can be paid at closing or financed into the loan.
Can I get a refund of the VA funding fee?
Possibly. If VA awards disability compensation with an effective date before your closing, you may be eligible for a refund, which VA pays to the veteran.
Sources
Information current as of September 16, 2026. General information only, not legal, tax or lending advice.
