VA loans allow 100% financing with no monthly mortgage insurance — the two facts that make them the strongest program available to those who qualify. The trade-off is a one-time funding fee that varies by down payment, prior entitlement use, and disability status.
Files are branded with Abodemic and your results — no data leaves your browser.
For a first-use purchase with no down payment the fee is 2.15% of the loan amount. It drops to 1.5% at 5% down and 1.25% at 10% down. Subsequent use with less than 5% down costs 3.3%. A streamline refinance (IRRRL) is a flat 0.5%.
Veterans receiving — or entitled to receive — compensation for a service-connected disability are exempt, as are eligible surviving spouses and Purple Heart recipients on active duty. Exemption removes the fee entirely, saving thousands on a typical loan.
No. VA loans carry no monthly mortgage insurance at any loan-to-value, including 100% financing. This is the program's largest economic advantage: a conventional borrower at the same LTV would pay several hundred dollars a month in PMI.
Yes. VA loans permit 100% financing on a primary residence, and the funding fee can be rolled into the loan, so a qualifying veteran can close with no down payment. You still pay closing costs, though a seller may contribute toward them.
A down payment reduces the funding fee at the 5% and 10% thresholds and lowers your payment, but VA borrowers give up no mortgage insurance by staying at 100%. For most veterans, keeping cash in reserve beats reaching for the fee discount.
Sources: U.S. Department of Veterans Affairs — VA funding fee; 38 U.S.C. § 3729 — statutory funding-fee schedule; VA Lenders Handbook (M26-7); Standard amortization (annuity) formula.
Estimates for educational purposes only — not a loan offer, financial advice, or a commitment to lend. Actual rates, payments, and terms vary by lender and creditworthiness.