VA loans carry no monthly mortgage insurance, ever. The funding fee is a single, financeable charge that replaces it. See your fee, your financed loan amount, and what you'd have paid instead on FHA or conventional.
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The VA funding fee is a one-time charge that replaces monthly mortgage insurance: 2.15% of the loan for first-time use with less than 5% down (3.30% for subsequent use), dropping to 1.25% with 10%+ down. It's $0 for veterans with a service-connected disability rating, and it's financeable into the loan.
If you receive VA disability compensation, you likely owe $0 — check your exemption before assuming the fee applies.
Reviewed by the licensed mortgage team at Simply Approved Mortgages · Last verified August 24, 2026 against the VA Lenders Handbook (M26-7)
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FHA and conventional comparisons use illustrative published/typical rates (FHA 1.75% upfront + 0.55% annual; conventional PMI ~0.50–0.75% annual) to show the value of paying a funding fee once instead of mortgage insurance every month. Your actual VA funding fee rate depends on your COE and down payment.
The VA funding fee funds the loan guaranty program at no cost to taxpayers. Unlike FHA's upfront + annual MIP or conventional PMI, it is charged exactly once, it can be rolled into the loan, and it is the only "insurance-like" charge a VA borrower ever sees — there is no monthly mortgage insurance at any LTV.
| Down payment | First use | Subsequent use |
|---|---|---|
| Less than 5% | 2.15% | 3.30% |
| 5% – 9.99% | 1.50% | 1.50% |
| 10% or more | 1.25% | 1.25% |
Veterans receiving VA compensation for a service-connected disability, veterans who would be entitled to compensation but for retirement or active-duty pay, veterans rated eligible from a pre-discharge exam, active-duty Purple Heart recipients, and qualifying surviving spouses pay $0. Your Certificate of Eligibility documents the exemption, and a fee can be refunded if a disability rating is granted after closing.
Since the funding fee is added on top of the price minus down payment, a $0-down purchase with a financed fee closes at slightly over 100% loan-to-value. That's normal and expected on a VA loan — there's no PMI trigger tied to it.
The VA funding fee is a one-time, financeable fee that replaces monthly mortgage insurance. On a purchase with under 5% down it's 2.15% for first-time use and 3.30% for subsequent use; 5–9.99% down drops it to 1.50%; 10% or more down drops it to 1.25% regardless of prior use.
Veterans receiving VA compensation for a service-connected disability, veterans who would be entitled to compensation but for retirement or active-duty pay, Purple Heart recipients on active duty, and qualifying surviving spouses pay $0. Your Certificate of Eligibility confirms exemption.
No. VA loans never carry monthly mortgage insurance or PMI, regardless of down payment or LTV. The one-time funding fee is the only insurance-like cost, and it's why VA loans are usually cheaper month to month than FHA or low-down conventional loans.
Funding fee = base loan amount × the applicable rate for loan type, use, and down payment. The financed loan amount adds the fee to the base loan when you choose to finance it. FHA/conventional figures are for comparison only.
Data year 2026. Program figures last checked against their source on 2026-01-01. Sources: VA Funding Fee. Results are estimates for planning only — not a quote, rate lock, approval, or commitment to lend. Your binding numbers appear on the Loan Estimate and Closing Disclosure.
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Hand-picked pages that answer the questions most people have after reading this one.
Related VA topics for this page — tap any question to jump straight to the answer.
The VA funding fee schedule sets the one-time cost that replaces mortgage insurance on every VA loan. Here's the current chart, who's exempt, and how it's financed.
Veterans receiving VA disability compensation pay $0 funding fee — often the single biggest savings in the entire loan. Here's how the exemption is proven and refunded.
Un-remarried surviving spouses of veterans who died in service or from a service-connected disability can use the VA loan benefit — often with the funding fee waived entirely.
Program rules and figures on this page are taken from the primary government sources below, not from third-party summaries.
Verified against VA Lenders Handbook M26-7, Change 6 — August 12, 2026. Simply Approved Mortgages is not affiliated with or endorsed by HUD, VA, or any government agency.
