What Is a VA Funding Fee and How Does It Work in Fort Worth Home Sales?

What is a VA funding fee and how does it work in Fort Worth home sales?

The VA funding fee is a one-time cost paid to the Department of Veterans Affairs to help sustain the VA loan program. It replaces private mortgage insurance and can be financed into the loan. Annie Sovereign explains how it works and what Fort Worth buyers need to know.

What Is the VA Funding Fee?

The VA funding fee is a required charge for most VA loan borrowers. It’s a percentage of the loan amount and helps the VA cover losses and continue offering the program with no PMI and low rates. It is not paid to your lender—it's paid directly to the VA.

2025 VA Funding Fee Rates (for Most Buyers)

- **First-time use with no down payment:** 2.15%

- **Subsequent use with no down payment:** 3.3%

- **With 5% down:** 1.5%

- **With 10%+ down:** 1.25%

 

These fees can either be paid upfront at closing or rolled into your total loan amount.

Who Is Exempt from the VA Funding Fee?

- Veterans receiving VA disability compensation

- Surviving spouses of veterans who died in service or from a service-connected disability

- Active-duty service members with a Purple Heart

 

Annie Sovereign can help determine if you're eligible for an exemption and ensure the paperwork is processed correctly.

How the Funding Fee Impacts Fort Worth Homebuyers

Let’s say you’re buying a $350,000 home in Fort Worth with no down payment:

- First-time VA buyer: Funding fee is $7,525 (2.15%)

- You can finance it, raising your loan to $357,525

- That’s still cheaper than paying PMI over the life of the loan

 

Annie Sells Texas helps you compare total costs and plan accordingly.

Can Sellers Pay the VA Funding Fee?

Technically no. The funding fee must be paid by the buyer—but sellers **can** cover other closing costs (up to 4% of the purchase price). This frees up your cash to cover the fee or helps you keep it financed.

Funding Fee Refunds: When You Might Get Money Back

If you're awarded VA disability compensation **after** closing but were charged the funding fee, you may be eligible for a refund. This process must be requested through the VA, and Annie Sovereign can help connect you with the right contacts.

Why Fort Worth Buyers Shouldn’t Fear the Funding Fee

It’s a fair trade-off for the VA loan’s benefits:

- No PMI

- 0% down payment

- Lower interest rates

 

Compared to FHA or conventional loan costs, the VA funding fee often results in a better deal over time—especially in Fort Worth’s appreciating housing market.

Trust Annie Sovereign to Navigate Every VA Loan Detail

With extensive experience in VA lending and a track record of helping military families in Fort Worth, Annie Sovereign ensures no surprises. From funding fees to closing credits, Annie and the Sovereign Elite Group help you understand every cost—and how to manage it smartly.

Annie Sovereign | Annie@AnnieSellsTexas.com | 817-875-8028 | www.anniesheroes.com