VA
Funding Fee

What Is the VA Funding Fee?

The VA Funding Fee is required by the Department of Veterans Affairs, not the lender originating the VA Loan. It is part of the Federal VA Loan program and helps to fund and insure the program.

Veterans who have a disability rating of 10% or greater are exempt from the VA Funding Fee. Eligible surviving spouses of Veterans who died in service, or as a result of service-related injuries are also exempt from the VA Funding Fee.

For the majority of Veterans buying a home with their VA benefits for the first time, the VA Funding Fee will be 2.15% of the loan amount. It’s important to remember that most of the time the VA Funding Fee is not paid out of pocket, but is included in the loan amount.

The VA Funding changes based on several factors including:

We will help you determine how much, if any amount, your funding fee will be when we pre-qualify you for a VA Mortgage loan.

To get started on your VA Home Loan, call us at 561-810-1711 or fill out the short form on this page. A specialist from our team will contact and assist you with your VA Mortgage pre-qualification.

Who Determines the VA Funding Fee?

VA loan funding fee rates are set by the VA and authorized by Congress. No lender can increase, decrease, or omit the funding fee without a designated exemption. Three criteria determine your rate: military service category, down payment amount, and whether this is your first or subsequent VA loan.

What Is the Funding Fee for a VA Loan in Florida?

The normal funding fee for a $0 down VA loan is 2.15% if you are a first-time VA user, or 3.3% if you are a previous VA user. 5% or more down lowers your rate. If you put 10% down, your funding fee rate is at its lowest at 1.25%.

These rates apply to the entire state, including Miami, Tampa, Jacksonville, Orlando, and the Florida Keys.

2026 VA Funding Fee Rates

Not every borrower will have the same fee rate. It varies depending on the loan type, your down payment, and whether you have used VA loans before.

Here is exactly what applies to you in 2026:

1. VA Funding Fee for Purchase Loans

0% down (1st use): 2.15%
0% down (subsequent use): 3.3%
5%-9.99% down: 1.5% (all uses)
10% or greater down: 1.25% (all uses)

2. VA Funding Fee for Refinance Loans (Cash-Out)

The funding fee for a VA refinance is similar to that for the purchase loan:

First use: 2.15%
Subsequent use: 3.3%

3. VA Funding Fee for IRRRL (Streamline Refinance)

All loans (whether purchase or refinance, with or without a down payment or prior VA use) carry a flat 0.5% funding fee, the lowest rate among VA loans.

VA Funding Fee Chart 2026

Check out this VA funding fee chart and find out the precise rate you qualify for based on your loan type, down payment, and loan use.

Borrower Type	Down Payment	First Use	Subsequent Use
Active Duty / Veteran	Less than 5%	2.15%	3.3%
Active Duty / Veteran	5% – 9.99%	1.5%	1.5%
Active Duty / Veteran	10% or more	1.25%	1.25%
Reserves / National Guard	Less than 5%	2.15%	3.3%
Reserves / National Guard	5% – 9.99%	1.5%	1.5%
Reserves / National Guard	10% or more	1.25%	1.25%
Disabled Veterans	Any amount	Exempt — $0	Exempt — $0
IRRRL (All Veterans)	N/A	0.5%	0.5%

Note: Effective January 1, 2020, Reserve and National Guard members pay the same rates as active duty veterans.

How to Calculate the VA Funding Fee?

The formula is simple:
Loan Amount × Funding Fee Rate = VA Funding Fee

Can You Reduce the VA Funding Fee?

There are three methods to reduce your rate:

Put Down Money: 5% lowers your rate to 1.5%; 10% lowers it to 1.25%.
Refinance with an IRRRL: The flat rate of 0.5% is currently the lowest possible rate.
Qualify For A VA Funding Fee Waiver: Eligible borrowers pay $0.

Things to Consider With the VA Funding Fee

The VA funding fee is simple in theory- but a few strategic decisions around it can significantly change what you pay. Here is what every Florida veteran should weigh before closing.

1. Exemptions

A VA funding fee waiver is 100% – there is no discount. You will pay nothing ($0) if you are eligible. Make sure the closing table approves your waiver status.

2. Financing vs. Paying Upfront

Incorporating the fee into your loan will reduce VA closing costs but increase your loan balance and the total interest paid. If you can pay it up front, your long-term cost will be lower.

3. Down Payment Impact

For a home of 500,000, the change from 0% down to 10% would shave over 5,000 off the funding fee—without accounting for interest savings on a smaller balance.

4. Long-Term Cost (Interest Impact)

Also, remember that the more money you borrow, the more you pay for the privilege. A financed $9,000 fee on a 30-year loan at 6.5% can cost you over $20,000 in total interest over the loan term.

5. Tax Deduction

The IRS may allow you to deduct this fee as a mortgage expense on your federal taxes. Please speak to a qualified tax advisor to ensure you are eligible.

VA Funding Fee Exemption Rules and Guidelines

This is not true of all veterans, though. If you are eligible for a full waiver under VA guidelines, knowing those guidelines before applying will save you thousands at closing.

Who Is Exempt?

Veterans can be fully exempted from the VA funding fee and $0:

Veterans receiving VA compensation for service-connected disability.
Veterans with a VA funding fee exemption at a rating of 10% or greater.
Veterans with a VA disability claim pending when closing occurs.
Surviving spouses of veterans deceased in service, or due to service-connected disability.
Active duty members who received a Purple Heart.

Any rating of 10% or higher automatically qualifies for a waiver of the entire fee. There is no partial exemption.

VA Funding Fee Exemption Form

To receive this exemption, you will need to provide the following to your lender:

Your VA award letter with your compensation rating.
Your Certificate of Eligibility (COE) may already indicate that you are exempt.
VA funding fee exemption form (VA Form 26-8937) – your lender submits this form to the VA.

Supply the documents to your lender at the beginning of the loan process. You do not want to wait until closing day.

Florida-Specific Rules

County Loan Amounts: While most FL counties cap VA loans at $832,750, Monroe County (Florida Keys) caps them at $990,150.
Documentary Stamp Tax: FL, VA loans exempt borrowers from paying part of this state tax.
Lender’s Title Insurance: Florida necessitates lender’s title insurance for VA loans (independent of the funding fee).

If your loan exceeds the county limit, it becomes a VA jumbo loan with different costs. Consult a FL VA loan expert about this.

Can you get a refund of the VA funding fee?

Not many Florida veterans realize they are owed money back if their situation has changed since they closed, or even if they were exempt from paying. You still got charged and you have the right to claim every dollar back.

When You Qualify?

You might receive a VA funding fee refund when:

You paid the fee at closing, and the VA approved a disability claim and a disability rating that predates your closing date.
The VA has an outstanding claim at the time of closing, which is approved at a later date.
You were an exempt borrower but paid the fee by mistake.

If one of the above circumstances occurs, you are entitled to 100% reimbursement.

The Refund Process

Receive your VA award letter (with rating and effective date).
Contact your loan servicer and request a refund review.
Provide your award letter as documentation.
The VA sends the refund directly to you or credits it to your loan balance if you financed the fee.

Allow a few weeks for the refund to be processed. Keep copies of everything. The VA Loans Florida team will guide you through this from start to finish.

How Will I Pay The VA Funding Fee?

Pay at closing– The entire amount is reflected on your Closing Disclosure (CD).
Roll it into your loan- This will include it in the loan at closing, and you won’t have to bring it with you to closing day, but your monthly payments will be higher by a little bit.

When Do You Pay the VA Funding Fee?

You pay them at loan closing, not at application or approval. If you roll the fee into your loan, you will pay it at the moment the loan closes and will find it on both the LE and the CD.

How Does the VA Funding Fee Differ From Mortgage Insurance?

Feature	VA Funding Fee	PMI (Private Mortgage Insurance)
Frequency	One-time, at closing	Monthly, ongoing
Typical Cost	1.25% – 3.3% of the loan	0.5% – 1.5% of the loan per year
Applies To	VA loans	Conventional loans under 20% down
Can Be Financed	Yes	No
Exempt Options	Yes — disabled vets pay $0	No exemptions
Ends Automatically	Yes — paid once	Only after reaching 20% equity

PMI can add $2,000-$6,000 annually to a $400k mortgage for 11-15 years, until you’ve got 20% equity. The VA funding fee is a one-time charge. Most veterans get the best long-term value from the VA loan.

Common Mistakes about the VA Funding Fee

Veterans lost actual money as a result of these myths. Review them all-if you have encountered these myths before, here is your chance to correct them.

“My loan officer can waive it.” – Your loan officer cannot waive this fee; a VA exemption is required.
“I have to have 20% to get the best rate.” – You have to have 10% to get a rate of 1.25%.
“Reserves & Guard members pay higher rates.” – As of 2020, they pay the same rates as any other veteran.
“I already paid it and cannot be refunded.” – You can if your claim is approved retroactively.
Disabled veterans are fully exempt. The fee is $0 — not a reduction, a complete waiver.
“The loan origination fee is the same thing.” – The origination fee is to your loan officer. The VA funding fee goes to the VA.

Do you have a question regarding VA funding fees in Florida? Ask Shirley Mueller and her team at VA Loans Florida. We have been helping Florida veterans understand their VA loan options since 2003, so we guarantee you will never pay more than you should for your VA loan.

Find out if you qualify for a VA loan – Speak with a FL VA Loan Expert today.

Frequently Asked Questions

1. What Is The VA Loan Funding Fee For Disabled Veterans?

Disabled veterans with a service-connected rating of 10% or more are exempt from the VA funding fee. Disabled veterans are exempt from the VA funding fee for all loan amounts.

2. Is The VA Funding Fee Mandatory For All Borrowers?

No. Veterans who receive a VA funding fee waiver- disabled vets, Purple Heart veterans, and eligible surviving spouses do not have to pay a thing.

3. Who Qualifies For A VA Funding Fee Exemption?

Active-duty Purple Heart recipients, veterans receiving VA disability benefits, survivors of those who lost their lives in service, and veterans having a pending claim for benefits at the closing are entitled to a total waiver of the VA funding fee.

4. Who Is Responsible For Paying The VA Funding Fee?

The borrower pays for it. However, a seller can cover it as part of the purchase agreement negotiation.

5. Is The VA Funding Fee Worth It?

Generally, yes. The funding fee for a VA loan is usually much less than the cost of Private Mortgage Insurance on a conventional mortgage, without the high down payment or PMI fee.

6. How Much Is The VA Funding Fee On Average?

First-time Florida VA buyers who finance a $400,000 home with no money down will pay $8,600 (2.15%). The majority of Florida VA transactions are between $5,000 and $15,000, depending on the loan amount.

7. Does The VA Funding Fee Have To Be Paid Upfront?

No, you can roll the fee into your overall mortgage payment; there will be no out-of-pocket cash at closing.

8. Is The Funding Fee Added To The Mortgage Balance?

Yes, if you will wrap the finance costs into the deal. This will add to the total loan amount due at closing.

9. Can I Finance The VA Funding Fee?

Yes. That’s a regular option; you don’t get charged for it. Your lender will add it to your loan balance at closing.

10. Who Sets The VA Funding Fee Rates?

The U.S. Department of Veterans Affairs sets these rates. Congress authorizes them through federal law. A lender or state agency can not alter these.

11. Which VA Loans Include A Funding Fee?

VA purchase loans, cash-out refinances, and IRRRLs also have a funding fee. Borrowers not eligible are only those exempted from it.

12. How Can I Lower My VA Funding Fee?

To hit the reduced rate levels, you can put down 5% or 10%. Utilize the IRRRL for the fixed 0.5% rate. Or have your status verified; if you are a disabled vet, you don’t need to pay the VA funding fee.

Specialist

VA Loan Specialist Shirley Mueller!

Working as a loan originator since 2003, Shirley has helped over 2000 Veterans with VA Home Loans. She has helped Veterans in almost every situation, including deployed personnel returning home or those with PCS orders. Shirley also helps disabled Veterans who…