VA Loan Costs to Buyer: Everything You Need to Know

Greetings! If you’re someone who’s planning to buy a home soon or is exploring different financing options, then you’re in the right place. In this article, we will dive deep into the world of VA loans and discuss one crucial aspect of it – the costs that a buyer might incur.

Understanding VA Loans

Before we start discussing the costs, let’s do a quick recap of what VA loans are. VA loans are home loan programs for veterans, active-duty military, and their families. These loans are backed by the Department of Veterans Affairs (VA) and offer various perks like no down payment requirement, lower credit score requirement, no private mortgage insurance, and easier refinancing options.

VA loans are available for a variety of housing needs, including buying a home, building a home, repairing or improving an existing home, and refinancing an existing VA loan.

The Costs Involved in VA Loans

Like any other mortgage program, VA loans come with certain costs that the buyer needs to bear. These costs can broadly be divided into two categories – closing costs and recurring costs.

Closing Costs:

Closing costs are one-time fees paid during the closing process when the ownership of the property is transferred from the seller to the buyer. These costs can vary depending on various factors like location, property value, and lender fees, among others. Some of the common closing costs in VA loans are:

Closing Cost
Cost Range
Lender’s title insurance
$500 to $1,500
VA funding fee
1.4% to 3.6% of the loan amount
Appraisal fee
$450 to $650
Recording fee
$25 to $250
Home inspection fee
$300 to $500
Origination fee
Up to 1% of the loan amount

Recurring Costs:

Recurring costs, also known as prepaid expenses, are ongoing expenses that the borrower needs to pay to maintain the property. These costs are required to be paid upfront during the closing process, and some of the common recurring costs in VA loans are:

  • Property taxes
  • Homeowner’s insurance
  • Mortgage insurance (if applicable)
  • Homeowner’s association (HOA) fees (if applicable)


1. Can the VA funding fee be waived?

Yes, some veterans and active-duty military members might be eligible for a funding fee exemption. For example, if you’re a veteran with a service-connected disability, you might not have to pay the funding fee.

2. Are VA loans only for first-time homebuyers?

No, VA loans can be availed by any eligible veteran, service member, or surviving spouse who meets the VA’s criteria.

3. Are VA loans only for primary residences?

No, VA loans can be used to buy primary residences, second homes, and even investment properties, provided they meet the VA’s occupancy requirements.

4. How much can one borrow with a VA loan?

The loan amount for a VA loan depends on various factors like the borrower’s income, credit score, and the property’s value. However, the VA doesn’t set a limit on how much a borrower can borrow, but they do have a cap on how much they will guarantee.

5. Can the seller pay for the closing costs?

Yes, the seller can pay for a part or all of the closing costs, depending on the terms of the sale contract and the lender’s policies.

6. What happens if the borrower misses a payment?

If the borrower misses a payment, their credit score might take a hit, and they might be charged late fees or penalty interest. If the borrower continues to miss payments, their loan might go into default, and the lender might initiate foreclosure proceedings.

7. Can VA loans be refinanced?

Yes, VA loans can be refinanced through the VA’s Interest Rate Reduction Refinance Loan (IRRRL) program or the VA Cash-Out Refinance program, depending on the borrower’s needs.


VA loans are an excellent financing option for veterans, service members, and their families who are looking to buy a home. However, like any other mortgage program, VA loans come with certain costs that the buyer needs to bear. By understanding the different fees and costs involved in VA loans, buyers can make informed decisions and plan their finances accordingly. We hope that this article has helped you gain insights into VA loan costs to buyers and answered some of your questions.

If you have any more queries or want to learn more about VA loans or other mortgage programs, feel free to reach out to us. We’ll be happy to assist you.


The information provided in this article is for educational and informational purposes only and should not be construed as legal or financial advice. We recommend that you consult with your financial advisor or lender before making any decisions.