2014 VA Loan Funding Fee and VA Loan PMI Fees

VA Home Loans are one of the best mortgage loan programs available. For Veterans who are buying a home in NC valued at less than $417,000 there’s no down payment required, and the Seller or Builder can pay most, if not all of your closing costs. The 2014 VA Loan Funding Fee is also incredibly low!

The Veteran’s Administration doesn’t actually make mortgage loans, they insure them. Because the US Government is “backing” your VA Loan, the mortgage interest rates are normally much more favorable than those for other loan types. Additionally, the 2014 VA Loan Funding Fees (which is the VA Loan version of PMI) are extremely low.

It’s important to remember that even though the Veteran is eligible for a VA Home Loan, the Veteran still must “qualify” for the mortgage loan.

Qualifying for a VA Loan is fairly straight forward, the minimum credit score requirements for VA Loans is actually not published by VA. In other words, they don’t really have a minimum credit score requirement – however, most banks we sell loans to require a minimum credit score of at least 620 to be eligible for a VA Loan.

For those who suffered a foreclosure or Short Sale, you can apply for a VA Loan 24 months after the transfer of title. If the previous loan was a VA Loan – you will likely be required to make the VA “Whole” before closing on a new VA Loan.

2014 VA Loan Funding Fee and VA Loan PMI Fees

The fees charged by the VA to cover the cost of insuring VA Loans is called a Funding Fee. It’s the VA Loan PMI fee. The VA Loan fees vary based upon the Veteran’s use of the program (first time VA Loan Users get a break), down payment and Military Service.

The VA Loan PMI charges are based upon the Loan amount, and the Veteran generally adds the PMI fees to the loan, although it can be paid in full at closing by the Veteran or the Seller.  There are no monthly PMI fees charged by the VA, unlike FHA PMI or Conventional Loans – which can add over $200 a month to the payment!

VA Loans do have a Funding fee that will be charged as follows until September 30, 2016:

As the table points out, there is a slight difference in the VA Funding Fee depending on whether you were active duty or spent time in the Reserves/National Guard. Those Veterans that are considered by the Veteran’s Administration to be eligible, will not be charged a Funding Fee, or might be charged one at a discounted rate based upon the percentage of Veteran disability determined by the Veteran’s Administration.

Surviving Spouses of a Veteran might also qualify for a reduced or waived VA Funding Fees.

If you have questions about 2014 VA Loan Funding Fee or VA Loan PMI Fees, please contact Steve and Eleanor Thorne 919-649-5058. We can help you with a Streamline refinance, or a purchase using your VA Home Loan Benefits.