Loan Officer Practice Exam 2026 – Comprehensive All-in-One Guide for Exam Success!

For VA-guaranteed loans, borrowers are required to pay a variable funding fee at closing. This fee is essential as it helps fund the VA loan program and enables veterans and active-duty service members to obtain home loans without needing to make a down payment. The funding fee can vary based on the loan amount, the type of service (first-time use or subsequent use of the VA loan benefit), and whether the borrower is making a down payment at all.

While other fees like upfront mortgage insurance premiums, processing fees, or origination fees may be associated with different types of loans, they do not pertain to VA loans specifically. The funding fee is unique to VA loans and serves an important function in maintaining the program, thus ensuring its sustainability for future borrowers.