As we delve into 2024, it’s crucial for veterans to understand the ins and outs of the VA funding fee, a component that plays a significant role in the overall cost of a VA home loan. The funding fee is a one-time payment required by the Department of Veterans Affairs (VA) to help sustain the VA loan program and make it possible for future generations of veterans to access this valuable benefit.
The VA funding fee is a percentage of the loan amount, and its purpose is to offset the costs associated with the VA loan program, eliminating the need for private mortgage insurance. The fee varies depending on factors such as the type of service, down payment amount, and whether the borrower has used the VA loan benefit before.
For first-time VA loan users in 2024, the funding fee ranges from 1.4% to 3.6%, depending on the down payment amount. Veterans with a service-connected disability are typically exempt from paying the funding fee, recognizing their sacrifice and service to the nation.
It’s important to note that the VA funding fee can be financed into the loan, alleviating the immediate financial burden on the borrower. While this may increase the overall loan amount, it provides an attractive option for those with limited upfront funds.
Additionally, surviving spouses of veterans who died in the line of duty or as a result of a service-related disability may also qualify for a waiver of the VA funding fee.
Understanding the nuances of the VA funding fee is crucial for veterans planning to utilize their home loan benefits in 2024. By being well-informed, veterans can make strategic decisions that align with their financial goals and ensure a smoother path to homeownership. As the landscape of VA loans evolves, staying abreast of these changes empowers veterans to make the most of this valuable program.
Ready to apply? Contact Loan Officer Lisbel Tasso NMLS 344608 239-287-3691
