The veteran may pay reasonable and customary amounts for any
of the following items:
(1) Fee of VA appraiser and of compliance inspectors designated by
VA. The veteran may pay for a second appraisal if he or she is requesting reconsideration
(2) Recording fees and recording taxes or other charges incident to
(3) Credit report.
(4) That portion of taxes, assessments and similar items for the
current year chargeable to the borrower and the initial deposit (lump-sum payment) for the
tax and insurance account.
(5) Hazard insurance
(6) Survey, if required by lender or veteran.
(7) Title examination and title insurance.
(8) Federal Express, Express Mail, or a similar service when the
saved per diem interest cost to the veteran will exceed the cost of the special handling.
(9) VA Funding Fee
A lender may charge and the veteran may pay a flat charge not
exceeding 1 percent of the amount of the loan, provided that the flat charge is in lieu of
all other charges relating to costs of origination not expressly specified and allowed in
this schedule. Costs covered by the 1-percent flat charge include the following:
(1) Lender's appraisals.
(2) Lender's inspections, except in construction loan cases.
(3) Loan closing or settlement fees.
(4) Preparing loan papers or conveyancing fees.
(5) Attorney's services other than for title work.
(7) Postage and other mailing charges, stationery, telephone calls,
and other overhead.
(8) Amortization schedules, pass books, and membership or entrance
(9) Escrow fees or charges.
(10) Notary fees.
(11) Commitment fees or marketing fees of any secondary purchaser of
the mortgage and preparation and recording of assignment of mortgage to such purchaser.
(12) Trustee's fees or charges.
(13) Loan application or processing fees.
(14) Fees for preparation of truth-in-lending disclosure statement.
(15) Fees charged by loan brokers, finders or other third parties
whether affiliated with the mortgagee or not.
(16) Tax service fees.
VA FUNDING FEE REQUIREMENT
The law requires that VA be paid a funding fee with guaranteed
loans. The only exceptions are loans made to veterans receiving VA compensation for
service-connected disabilities, or who, but for receipt of retirement pay, would be
entitled to receive compensation, and loans made to surviving spouses of veterans who died
in service or from service-connected disabilities.
Basic Funding Fees - First-time Use. The funding fees for veterans
who have not previously obtained a VA loan and whose loan eligibility is not
derived from 6 years of service in the Selected Reserve are:
(1) 2.0 percent of the loan amount for loans with downpayments of
less than 5 percent.
(2) 1.5 percent of the loan amount for loans with at least a 5
(3) 1.25 percent of the loan amount for loans with at least a 10
Funding Fee for Reservists - First-time Use. These veterans will pay
the following funding fees:
(1) 2.75 percent of the loan amount for loans with downpayments of
less than 5 percent.
(2) 2.25 percent of the loan amount for loans with at least a 5
(3) 2.0 percent of the loan amount for loans with at least a 10
Funding Fees for Subsequent Use. Except for interest rate reduction
refinancing loans, veterans (including those whose eligibility is derived from service in
the Reserves/National Guard) using the loan program for the second and subsequent times
will pay increased funding fees.
The fees for subsequent use are:
(1) 3.0 percent of the loan amount for loans with downpayments of
less than 5 percent.
(2) 1.5 percent of the loan amount (2.25 percent for
Reserves/National Guard) for loans with at least a 5 percent downpayment.
(3) 1.25 percent of the loan amount (2.0 percent for
Reserves/National Guard) for loans with at least a 10 percent downpayment.
The downpayment is computed on the property sales price. When a
sales price is above the reasonable value of the property, as determined by VA, the
portion of the downpayment attributable to reducing the loan amount to reasonable value
may be used to calculate the fee. In cases involving partial entitlement, the downpayment
required to permit sale of the loan in the secondary market also counts toward the 5- or
10-percent downpayment for funding fee calculation.