Yes, VA funding fee rates can change in 2026, and official tables are typically posted early each year. The fee is separate from benefit COLA, and it is applied by loan purpose and usage. Your exemption status appears on your Certificate of Eligibility, and lenders update disclosures once new tables become effective.
Quick Facts
- The funding fee is a one time program charge, not a recurring monthly premium.
- Official tables publish annually, lenders adopt new figures once effective.
- COLA affects benefits, not statutory funding fee percentages.
- Exemption status appears on your Certificate of Eligibility.
- Loan purpose and prior use influence the fee category applied.
Mini FAQ
Is the funding fee the same as mortgage insurance
No. VA loans do not require monthly mortgage insurance. The funding fee is a one time charge that supports the program, and many borrowers roll it into the loan rather than paying it out of pocket at closing.
Can lenders waive the funding fee for me
No. Lenders cannot waive a statutory fee. But if you are exempt due to qualifying disability compensation, the fee is not charged. Lender or seller credits can still reduce other allowable closing costs outside of the fee.
When are new annual rates usually available
Historically, the program posts updated funding fee information early in the year. Once guidance is published and effective, lenders update loan estimates, disclosures, and closing packages to reflect the correct fee category and amount.
Key Takeaways
- VA posts funding fee tables annually, lenders apply new figures once guidance is effective.
- COLA adjusts benefits, it does not change funding fee categories, purposes, or percentages.
- Exemption appears on your Certificate of Eligibility, confirm before pricing and disclosures.
- Loan purpose drives category differences, purchase, cash out, and IRRRL follow distinct rules.
- Model payment with and without financing the fee, choose the option that preserves reserves.
- Request refreshed loan estimates immediately after publication, then validate cash to close.
Will the VA funding fee change in 2026, and when are new tables published?
Yes, VA funding fee tables can change year to year, and updates typically publish early in the calendar year. The official program page explains allowable closing costs, how the funding fee works, and how exemptions apply. Check the VA site for current tables when you are ready to lock terms and finalize disclosures. VA funding fee and closing costs.
- Lenders do not control statutory fee percentages, they update figures on loan estimates and closing disclosures as soon as official tables become effective, then reissue documents if a rate change occurs during your process.
- Purchase, cash out refinance, and IRRRL follow different categories and calculations, so you should confirm the correct purpose code on your estimate, then verify that your final disclosure matches the same category at signing.
- Funding fee changes do not affect monthly escrowed items like taxes and insurance, but they can alter the financed balance and the total cash to close depending on whether you pay the fee in cash or finance it.
- Ask your lender to price with the current tables and to run a second scenario with a modest change assumption, which prepares you for either outcome if publication timing overlaps your contract.
- When the VA posts the new tables, request an updated loan estimate immediately, then compare the financed amount and cash to close line by line to confirm the correct category and figure.
- Lock your rate only after your documentation is complete and appraisal access is scheduled, which reduces the need for rework if tables update during underwriting.
What is the funding fee, and why is it separate from benefit COLA?
The funding fee is a program specific charge that supports the guaranty, while COLA adjusts benefit payments and is calculated separately. COLA is set under Social Security formulas and affects certain benefit checks, not the mortgage fee schedule. Understanding this separation prevents confusion when both announcements occur near the same time. Social Security COLA overview.
- The fee replaces monthly mortgage insurance that other programs charge, which is why many VA borrowers have lower monthly costs even when financing a high portion of the purchase price in the final loan.
- COLA relates to benefit payments and not to loan pricing mechanics, so you should plan mortgage budgets separately, using the lender’s estimate for principal, interest, taxes, insurance, and association dues.
- Do not assume COLA changes any housing numbers; it does not. You still need a fresh lender estimate after VA publishes the new fee tables for your loan type and usage.
- Check benefit updates on your normal schedule, then ask your lender for a separate mortgage estimate, keeping benefit adjustments and mortgage fees in different planning buckets for clarity.
- Decide whether to finance the fee or pay it in cash by comparing monthly impact, reserves, and post closing comfort, then choose the approach that preserves your cushion.
- Document any benefit income clearly for underwriting, then keep mortgage and benefit records organized so both updates proceed smoothly without crossed signals.
Who is exempt from the VA funding fee, and how do you verify status?
Exemptions usually apply to borrowers with qualifying disability compensation, surviving spouses in eligible categories, and certain active duty cases with documentation. Your Certificate of Eligibility displays exemption status, which lenders rely on to prepare accurate disclosures and to avoid charging the fee when you qualify for relief. VA eligibility and COE.
- If the COE shows exempt, your loan estimate should reflect zero for the funding fee line, and your note amount should exclude that figure unless a property change or purpose change requires a fresh calculation.
- When the COE is silent or unclear, provide benefit letters promptly so the lender can confirm status with the program, which prevents last minute changes that disrupt signing and funding schedules.
- For joint loans or unique service histories, ask your lender early about how exemption applies, since mixed files sometimes need extra review to ensure the correct treatment on disclosures and title documents.
- Retrieve your COE electronically through your lender, then read the exemption indicator together and save a copy with your preapproval and offer documents for quick reference.
- Upload benefit letters and award notices as searchable PDFs, which allows underwriters to verify status without back and forth near the closing date.
- Request corrected disclosures immediately if your exemption changes during the process, so the closing package matches the final status on funding day.
How are funding fee categories determined, and what drives changes year to year?
Categories are defined by loan purpose and prior use, and the governing rules reside in federal regulations and program guidance. Updates reflect statute and policy decisions, not lender choice. The regulation that governs VA guaranteed loans outlines origination and guaranty requirements that lenders must follow when calculating charges and preparing closing packages. eCFR Title 38, Part 36.
- Purchases and cash out refinances sit in different categories from IRRRL transactions, which is why fee lines on disclosures change when a borrower switches from a standard refinance plan to a rate reduction approach mid process.
- First use and subsequent use may be treated differently, so your history matters. Confirm with your lender how prior usage appears in calculations and whether restoration of entitlement has been processed.
- Annual updates can also adjust rounding, timing, or documentation mechanics, which is why lenders reissue estimates and disclosures promptly when new tables become effective.
- Confirm loan purpose early and keep it consistent, since purpose changes can flip categories and alter disclosures, which risks timeline extensions if discovered late.
- Ask whether your entitlement restoration is complete if you paid off a prior VA loan, then verify that your COE lines up with the plan shown on your estimate.
- Request a side by side estimate that compares your current category to an alternative approach so you understand the cash and payment differences before choosing.
How will a new fee table affect cash to close and long term cost planning?
The funding fee affects your financed balance and cash to close, but the monthly impact is often modest when spread over a full term. Use your lender’s calculator for precise numbers, and remember that discount points, credits, and tax escrows typically have larger monthly influence than a small fee change. CFPB guidance on discount points.
- Financing the fee raises the loan amount slightly, which marginally increases the principal and interest portion of your payment, while paying it in cash preserves the balance and can lower total interest over time.
- Seller and lender credits cannot remove a statutory fee, but they can offset other closing costs so your total cash to close remains comfortable even if the fee increases from the prior table.
- If a new table publishes during your transaction, your lender will update disclosures and the closing disclosure automatically, so verify the new balance and cash lines match your elections.
- Ask for two loan estimates, one with the fee financed and one paid in cash, then compare the monthly change and your post closing reserves to select the better approach.
- Review the cash to close calculation and confirm how credits, escrows, and prepaid items interact, ensuring there are no surprises at signing.
- Recalculate your emergency fund target after choosing a payment, keeping at least several months of total housing costs in reserve for stability.
Do purchase, cash out refinance, and IRRRL treat the fee differently, and what should you expect?
Yes, fee treatment varies by purpose, and IRRRL often carries the smallest category because it reduces rate and payment on an existing VA loan. Program pages explain eligibility and purpose definitions for each path. Review the correct page for your transaction to confirm category and documentation expectations. VA cash out refinance overview.
- Purchase categories consider first use and subsequent use, while cash out refinance involves a different risk profile, which is reflected in its category and documentation, including equity and title checks.
- IRRRL emphasizes payment reduction with streamlined documentation, and many files do not require appraisal, which is why the fee and process are structured differently from purchase and cash out transactions.
- Your lender will confirm which purpose applies. Switching purpose mid process can require new disclosures and, at times, a revised underwriting approach to align with program rules.
| Purpose | Typical documents | General fee behavior |
|---|---|---|
| Purchase | Income, assets, appraisal, title | Varies by first use or subsequent use category |
| Cash out refinance | Income, assets, appraisal, equity review | Different category from purchase due to risk profile |
| IRRRL | Streamlined, often no appraisal | Generally the smallest category for rate reduction |
- Confirm purpose and category in writing on your estimate, then keep that structure consistent to avoid rework and timeline extensions late in the process.
- If you qualify for an IRRRL, compare total cost, time to recoup, and documentation burden versus any alternative that may require a full appraisal and longer review.
- Check whether exemption applies regardless of purpose, since eligible exemption removes the fee entirely across categories.
What timeline should you follow around annual publication, and how do you keep files on schedule?
Plan for a publication window early each year, then verify category and amounts once tables go live. The VA purchase loan page summarizes borrower and lender roles, which helps you coordinate appraisal access, title work, and disclosure refreshes efficiently when any update arrives close to your funding date. VA purchase loan.
- Ask your lender about their update protocol and how quickly loan estimates and closing disclosures are reissued when the program posts new tables, then set calendar reminders to request confirmatory copies.
- Keep your document set current with fresh statements, since expired records force rechecks that may collide with table updates, adding unnecessary friction to your closing timeline.
- Leave a small buffer in your rate lock to cover reinspection or reissue of disclosures after publication, which is cheaper than paying an extension fee at the last minute.
| Phase | Action before publication | Action after publication |
|---|---|---|
| Preapproval | Model scenarios with current tables | Request updated letter and estimate immediately |
| Under contract | Confirm purpose and category in writing | Recheck financed balance and cash to close lines |
| Clear to close | Verify exemptions and fee election | Ensure closing disclosure reflects new table accurately |
- Hold a weekly check in with your loan officer during the window when publication commonly occurs, and ask for written confirmation that your disclosures match the new table.
- Coordinate appraisal access and repairs early, since reinspection needs can bump into fee table updates and cause avoidable extensions if left too late.
- Review the closing disclosure several days in advance, then confirm wire instructions and total cash after the final update is posted by the lender.
Where should you monitor official updates, and how do you avoid misinformation?
Use official program pages for fee tables and eligibility details, and rely on your lender for updated disclosures. The main VA home loan page consolidates links to loan types, eligibility, and closing cost guidance. Bookmark it and check during your shopping and underwriting phases for the most current information. VA home loan program overview.
- Third party articles can be useful background, but final answers should come from official sources and your loan documents, since those carry the controlling figures used at closing.
- If you see conflicting numbers, compare publication dates and confirm whether you are reading prior year tables, then contact your lender to reconcile discrepancies with the current release.
- Keep all versions of loan estimates and closing disclosures in one folder. Clear version control avoids confusion and speeds any post closing questions on exact amounts.
- Bookmark the program overview and the funding fee page, then set a calendar reminder to check for updates as your shopping window opens.
- Ask your lender for a single point of contact who will refresh your file when new tables publish, reducing delays from scattered communication.
- Store your COE, benefit letters, and estimates together so you can verify exemption status and category quickly when disclosures update.
The Bottom Line
The funding fee is a one time, program specific charge that VA publishes annually, separate from benefit COLA. For 2026, expect updated tables early in the year, then verify the correct category, exemption status, and election to finance or pay in cash. Use official pages, request refreshed estimates immediately after publication, and keep your file organized. These steps protect your payment, your cash plan, and your closing date.
References used
- VA, funding fee and allowable closing costs
- SSA, annual COLA information
- VA, eligibility and Certificate of Eligibility
- eCFR, Title 38, Part 36, VA loan guaranty regulations
- CFPB, discount points and payment tradeoffs
- VA, cash out refinance overview
- VA, purchase loan pathway
- VA, home loan program overview
Frequently Asked Questions
Will the VA funding fee definitely change for 2026
It may. The Department of Veterans Affairs publishes fee tables annually, and changes depend on statute and program guidance. Monitor the official funding fee page and ask your lender to refresh your loan estimate the moment new tables post.
Is the funding fee tied to the annual COLA for disability benefits
No. COLA affects certain benefit checks, not mortgage fee tables. Treat them separately. Use official program pages for fee categories and use your lender’s updated disclosures to confirm the precise amount for your loan purpose.
How can I confirm if I am exempt from the funding fee
Your Certificate of Eligibility shows exemption status. Lenders rely on the COE and supporting benefit letters to issue accurate disclosures. If the COE is unclear, upload benefit documentation so the lender can confirm exemption before closing.
Does the fee change my monthly payment a lot if I finance it
Usually the monthly change is modest compared with total escrowed costs, but it depends on loan size and term. Ask for two estimates, one financing the fee and one paying in cash, then choose the approach that preserves reserves.
Can seller credits eliminate the funding fee completely
No. Credits can offset allowable closing costs, not a statutory program fee. If you are exempt, the fee is not charged. Otherwise, your choice is to pay it in cash or finance it within the mortgage balance.
Do fee categories differ for purchase, cash out refinance, and IRRRL
Yes. Categories depend on loan purpose and prior use. Purchases and cash out refinances differ from IRRRL, which focuses on rate reduction. Confirm the purpose code on your estimate and final disclosure to ensure the correct category is applied.
What should I do if new tables publish while I am under contract
Ask your lender to reissue your estimate and closing disclosure immediately. Verify the category, line item amount, and whether you are financing or paying the fee in cash. Confirm that cash to close and loan amount match your election.
Will loan limits affect my funding fee amount
Loan limits relate to entitlement and zero down thresholds, not directly to fee percentages. The funding fee is determined by purpose, prior use, and exemption status. Your lender can model entitlement and fee outcomes in one worksheet.
Does paying discount points change the funding fee
No. Discount points buy a lower interest rate and are separate from the funding fee. Compare the cost of points and monthly savings with your time horizon, then decide whether points or credits better fit your budget.
How early should I check for 2026 fee updates
Begin monitoring as your shopping window opens. Historically, new tables appear early in the year. When they post, request a refreshed estimate right away and verify exemption status, category, and your election to finance or pay in cash.
Levi Rodgers is the Founder of VA Loan Network, a leading resource for Veteran homebuyer education. A Retired Green Beret and Broker-Owner of LRG Realty in San Antonio, Levi leverages his military discipline and real-world real estate expertise to provide Veterans with expert loan advice, guidance, and trusted financial leadership.
