What the VA Funding Fee Is
The VA funding fee is a one-time charge, set by statute (38 USC § 3729(b)), that helps keep the VA home-loan program self-sustaining so it costs taxpayers as little as possible. It's the price of the program's biggest benefits: no down payment and no monthly mortgage insurance. The fee is a percentage of the loan amount, and most borrowers roll it into the loan rather than pay it at closing — which is how this calculator models it by default.
Two things move the percentage: how much you put down and whether this is your first VA loan. The current schedule has been in effect since April 7, 2023.
The 2026 Purchase Funding-Fee Schedule
For a VA purchase loan:
- First use: 2.15% with less than 5% down · 1.50% with 5–9.99% down · 1.25% with 10% or more down.
- Subsequent use: 3.3% with less than 5% down · 1.50% with 5–9.99% down · 1.25% with 10% or more down.
The only tier that differs between first and subsequent use is the under-5%-down tier — the subsequent-use 3.3% is the single biggest reason a second 0%-down VA purchase costs more up front. Putting 5% down drops either case to 1.50%.
No Separate Reserve or Guard Rate (Anymore)
If you've read older guides, you may have seen a higher funding fee for Reserve and National Guard members. That distinction is gone. The Blue Water Navy Vietnam Veterans Act of 2019 eliminated the active-duty vs. Reserve/Guard difference effective January 1, 2020. Today every service component pays the same purchase schedule above — this calculator does not ask for your component because it no longer changes the fee.
Who's Exempt From the Funding Fee
Some borrowers pay no funding fee at all. The exemption (38 USC § 3729(c)) applies to:
- Veterans who receive — or are entitled to receive — VA compensation for a service-connected disability.
- Purple Heart recipients serving on active duty.
- Eligible surviving spouses of veterans who died in service or from a service-connected disability.
Eligibility is determined by the VA, not self-reported — it's tied to your compensation status, not a specific disability rating percentage. Toggle the exemption in the calculator to see the fee drop to $0. Questions about borderline eligibility are a good fit for Ask the Military Expert.
Why VA Loans Never Have PMI
On a conventional loan, putting down less than 20% almost always triggers private mortgage insurance (PMI) — a monthly charge that protects the lender, not you, and can run a couple hundred dollars a month. FHA loans carry a similar mortgage insurance premium. VA loans carry neither, even at 0% down. The one-time funding fee replaces ongoing mortgage insurance entirely, which is often the single largest monthly advantage of using your VA benefit.
Is There a VA Loan Limit?
For most veterans, no. Since January 1, 2020, veterans with full entitlement have had no VA loan limit — you can borrow as much as a lender will approve with no down payment. The old “county loan limits” you may have heard about now apply only to borrowers with partial entitlement — for example, if you already have one VA loan in place, or previously had a VA loan foreclosed.
For partial entitlement, the limit mirrors the FHFA conforming loan limit — the 2026 baseline is $832,750 for a one-unit property (higher in designated high-cost areas). The calculator flags when your loan crosses that baseline so you know to check your entitlement — but it does not imply a universal cap, because for full-entitlement borrowers there isn't one.
Why You Enter the Interest Rate
Notice the calculator asks you for the interest rate. That is deliberate. Your rate depends on your credit, the lender, the day, and points you may buy — it is not a figure Garrison Ledger can honestly assert. So the funding fee and loan amounts (which are grounded in statute) show regardless, and the monthly payment only appears once you enter a rate you were actually quoted. Get at least two lender quotes; VA rates and lender fees vary more than borrowers expect.
Purchase Loans Only
This calculator covers purchase loans. VA refinances — the Interest Rate Reduction Refinance Loan (IRRRL) and the cash-out refinance — use different funding-fee schedules, and applying the purchase percentages to a refinance would give you the wrong number. If you're refinancing, confirm the correct fee with your lender or the VA funding-fee page.
How This Calculator Works
The funding fee comes straight from the statutory 38 USC § 3729(b) schedule — the same percentages the VA publishes — selected by your down-payment tier and first-vs-subsequent use, or set to $0 when you mark the exemption. The fee is rolled into the loan, and the total loan is what the monthly principal and interest are computed against. The provenance control on the funding-fee result shows the statute and the schedule's effective date so you can verify it. We never estimate a funding fee; it's a number with a citation.
Related Garrison Ledger Tools
- House Hacking Calculator — Using a VA loan on a 2-4 unit property and renting the other units? Model the rental cash flow and BAH offset.
- BAH Calculator — Your tax-free housing allowance is often what covers the VA-loan payment. Look up the official rate for your duty station.
- Military Salary Calculator — Weighing a move or a civilian offer? See how housing and the VA benefit factor into total compensation.
- Ask the Military Expert — Cited answers on entitlement restoration, occupancy rules, and VA-vs-conventional for your specific situation.
Sources
VA — Funding fee and closing costs · VA — Loan limits · FHFA — 2026 conforming loan limits