About this calculator
The VA funding fee is the price of the guarantee that lets a lender offer zero down with no monthly mortgage insurance. From VA's table (rates in force since April 7, 2023): on a purchase, a first-time VA borrower pays 2.15% with less than 5% down, 1.50% with 5–9.99% down, and 1.25% with 10% or more down. Subsequent use raises only the low-down-payment row, to 3.30% — the 5% and 10% tiers stay at 1.50% and 1.25%, which is why repeat VA buyers who can reach 5% down barely notice the "subsequent use" penalty. Cash-out refinances are flat 2.15% / 3.30% with no equity discount at all, and IRRRL streamline refinances are just 0.50%.
Two groups pay nothing: veterans receiving VA disability compensation (and those who would, but for receiving retirement pay), surviving spouses receiving Dependency and Indemnity Compensation, and a few other listed categories are exempt — the calculator has the tick-box. And unlike every other low-down-payment loan, a VA loan never charges monthly PMI or MIP: once the funding fee is settled, the insurance cost of the loan is zero forever. That is why a VA loan so often beats FHA over a full term despite FHA's lower headline insurance in year one.
How to use it
- Enter price and down payment — zero down is a normal VA purchase, not an exception.
- Set the purpose honestly: purchase tiers differ from the flat cash-out rate, and IRRRLs are 0.50%.
- If you receive VA disability compensation, tick the exemption — the fee becomes $0.
- Compare financing the fee versus paying cash: the table shows what each down-payment tier does to the fee on a purchase.
The formula
The fee is a percentage of the loan amount (price minus down payment), not of the price. It is the VA's insurance premium, paid once: it funds the guarantee that covers the lender if the loan defaults. There is no monthly component on any VA loan, at any LTV, ever — a structural difference from FHA (annual MIP) and conventional (PMI) loans.
Worked example
A $400,000 purchase with zero down, first use: the funding fee is 2.15% of $400,000 = $8,600, financed into a $408,600 loan costing $2,582.63 a month at 6.5% over 30 years — and nothing per month for insurance, where an equivalent FHA loan would add $176.92 a month of MIP for life. Buy the same home a second time with VA (subsequent use) and the fee is 3.30% = $13,200; put 10% down instead and it falls to 1.25% of $360,000 = $4,500 either way.
Sources: VA funding fee table published at va.gov (rates in force since April 7, 2023); full-entitlement loan-limit rules in force since January 1, 2020. Last updated: October 2026.
Frequently asked questions
Who is exempt from the VA funding fee?
Per VA.gov: veterans receiving disability compensation for a service-connected disability; veterans who would receive it but for receiving retirement or active-duty pay; surviving spouses receiving Dependency and Indemnity Compensation (and certain spouses of veterans who died in service or from service-connected disabilities); Purple Heart recipients on active duty; and a few other listed cases. If you have a disability rating and a pending claim, lenders can often document the exemption once the rating is decided — ask before closing, because refunds after the fact are limited.
Is there a VA loan limit?
Not with full entitlement: since January 1, 2020, veterans who have never used their entitlement (or have restored it in full) can borrow any amount a lender will approve with no down payment required by VA. County loan limits now matter only with partial entitlement — for example, a second VA loan while the first is still outstanding — where the remaining entitlement caps the zero-down amount.
Why is the subsequent-use fee higher?
The fee subsidizes the program's losses, and VA prices repeat use as higher risk at low down payments: 3.30% versus 2.15% with under 5% down. But the penalty vanishes with a real down payment — at 5% down both first and subsequent use pay 1.50%, and at 10% both pay 1.25%. For a repeat buyer, reaching 5% down is usually worth more than any rate shopping.
VA or FHA — which is cheaper?
For an eligible veteran, VA almost always wins over time: no monthly insurance, and the one-time fee (2.15% first use) is comparable to FHA's 1.75% upfront — while FHA adds 0.50–0.55% a year for 11 years or life. FHA remains the fallback for buyers without VA eligibility, weak credit (FHA underwriting is more forgiving), or a purchase above what a lender will approve under VA residual-income rules.
Can the seller pay my funding fee?
The fee itself is yours, but VA allows sellers to make concessions up to 4% of the price toward buyer costs, and the fee can be financed instead of paid in cash — the two common ways it stops being a closing-day problem. It cannot be waived by the lender; only VA exemption status zeroes it.
What formula does this va loan calculator use?
Funding fee = base loan × table rate (purchase: 2.15/3.30%, 1.50%, 1.25% by down-payment tier and use; cash-out: 2.15/3.30% flat; IRRRL: 0.50%; exempt: 0%). Loan = base + fee if financed. The fee is a percentage of the loan amount (price minus down payment), not of the price. It is the VA's insurance premium, paid once: it funds the guarantee that covers the lender if the loan defaults. There is no monthly component on any VA loan, at any LTV, ever — a structural difference from FHA (annual MIP) and conventional (PMI) loans. The worked example on this page applies the formula step by step with real numbers, so you can verify the result by hand.