What upfront fee is required on a VA guaranteed loan?

What upfront fee is required on a VA guaranteed loan?

• A. Origination Fee
• B. Funding Fee
• C. Service Fee
• D. Application Fee

Answer: (B)

The upfront fee required on a VA guaranteed loan is known as the Funding Fee. This fee is paid to help sustain the VA loan program and can vary based on factors such as the type of service, the amount of down payment made, and whether it is the borrower’s first use of the entitlement. The Funding Fee can often be rolled into the loan amount, which makes it easier for veterans to manage their upfront costs. This fee serves a vital purpose in supporting the program that provides guaranteed loans to veterans and helps to keep the military mortgage program sustainable for future generations. The application and origination fees are common in other types of loans but do not specifically apply to the unique structure and purpose of VA loans. Similarly, the service fee is not a standard requirement and may not directly relate to the upfront costs associated with obtaining a VA loan.

The upfront fee required on a VA guaranteed loan is known as the Funding Fee. This fee is paid to help sustain the VA loan program and can vary based on factors such as the type of service, the amount of down payment made, and whether it is the borrower’s first use of the entitlement.

The Funding Fee can often be rolled into the loan amount, which makes it easier for veterans to manage their upfront costs. This fee serves a vital purpose in supporting the program that provides guaranteed loans to veterans and helps to keep the military mortgage program sustainable for future generations. The application and origination fees are common in other types of loans but do not specifically apply to the unique structure and purpose of VA loans. Similarly, the service fee is not a standard requirement and may not directly relate to the upfront costs associated with obtaining a VA loan.