If a veteran has sold a property and repaid a VA loan, what is the funding fee for a new VA loan application?

The funding fee for a new VA loan application is determined based on various factors, including the veteran's service status and whether they have used the VA loan benefit before. If a veteran has sold a property and repaid a VA loan, they are typically eligible for another VA loan, and the funding fee can vary depending on usage.

The correct answer reflects a higher fee that applies to certain categories of loans. Specifically, for veterans who have previously used their entitlement and are applying for a new VA loan with the prior loan paid off, the funding fee is usually set at 3.60% of the loan amount. This percentage is higher than what would be applicable for first-time VA loan recipients, which can be 2.30% or lower, depending on other qualifying circumstances.

Understanding the different percentages for funding fees is crucial, as they can affect the overall cost of obtaining a VA loan. For veterans who have utilized their benefits previously and then pay off that loan, the funding fee reflects both their past use of the benefit and the overall cost of administering the loan program.