Reduced VA Funding Fees Caught in Political Tug-of-War

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Real Estate Technology with Imagine WOW! Digital Marketing Agency

va funding fee tug-of-warReduced VA Funding Fees are currently stuck in a political tug-of-war. VA funding fees that were scheduled to be reduced as of October 1st have been delayed causing massive confusion within the mortgage industry. It’s also left many veterans wondering if they will be able to take advantage of the reduction in costs.

The initial VA Circular which was triggered by the Restoring GI Bill Fairness Act was set to lower VA funding fees significantly. Unfortunately that was short lived. We then received Circular 26-11-15 which was prompted by the Veterans Health Facilities Act Capital Improvement Act. This effectively took the reduced fees and put the previous fee structure back into place until November 18, 2011. As of right now the reduced funding fee structure is set to go back into place at that point.

However, I do anticipate that additional legislation affecting these funding fees will get passed and once again we will be back to the same funding fee structure we are using now and were using prior to October 1, 2011.

The following VA Funding Fees are currently in effect:

Veteran Reservist/ Guard First Time Use Less than 5% down payment:

• October 1, 2011 until October 5, 2011 1.40% 1.65% • October 6, 2011 until November 17, 2011 2.15% 2.40%

• On or after November 18, 2011 1.40% 1.65%

At least 5 percent but less than 10 percent down payment:

• October 1, 2011 until October 5, 2011 0.75% 1.00% • October 6, 2011 until November 17, 2011 1.50% 1.75%

• On or after November 18, 2011 0.75% 1.00%

10 percent or more down payment:

• October 1, 2011 until October 5, 2011 0.50% 0.75% • October 6, 2011 until November 17, 2011 1.25% 1.50%

• On or after November 18, 2011 0.50% 0.75%

Subsequent Use with Less than 5 percent down:

• October 1, 2007 until October 1, 2011 3.30% 3.30% • October 1, 2011 until October 5, 2011 2.80% 2.80% • October 6, 2011 until November 17, 2011 3.30% 3.30%

• November 18, 2011 until October 1, 2012 2.80% 2.80%

• October 1, 2012 until October 1, 2013 2.15% 2.15% • On or after October 1, 2013 1.25% 1.25%

At least 5 percent but less than 10 percent down:

• October 1, 2011 until October 5, 2011 0.75% 1.00% • October 6, 2011 until November 17, 2011 1.50% 1.75%

• On or after November 18, 2011 0.75% 1.00%

10 percent or more down:

• October 1, 2011 until October 5, 2011 0.50% 0.75% • October 6, 2011 until November 17, 2011 1.25% 1.50%

• On or after November 18, 2011 0.50% 0.75%

If it feels confusing then you are right. Contact your loan officer before getting caught in the middle of the VA Funding Fee tug-of-war.

For more information on using your VA eligibility or VA loans, visit my VA Website VA Mortgage Insider Tips and instantly download the FREE e-book Insider Secrets Mortgage Companies and Loan Officers DON’T want you to know about Veteran Loans.




Reduced VA Funding Fees Caught in Political Tug-of-War was written by Rebekah Radice.


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Rainmaker
464,376
Sondra Meyer:
Star View Real Estate - Colorado Springs, CO
See It. Experience It. Live It.

What a mess.....  It is a good thing that your clients have you to try to stay on top of what is happening. 

Oct 11, 2011 03:02 AM #1
Rainmaker
1,116,216
Jim Frimmer
HomeSmart Realty West - San Diego, CA
Realtor & CDPE, Mission Valley specialist

Seems like everything in life becomes a political football nowadays.

Oct 11, 2011 08:06 AM #2
Rainmaker
291,474
Rebekah Radice
Imagine WOW! Digital Marketing Agency - Burbank, CA
Social Media Marketing, Coaching & Training

It is a mess Sondra, but thank you for the compliment!  I sure try!

Isn't that the truth Jim?!

Oct 11, 2011 01:22 PM #3
Rainmaker
486,463
David Krichmar
www.DaveYourMortgageGuy.com - Legend Lending - Sugar Land, TX
DaveYourMortgageGuy.com

I was really disappointed to see that all they did was delay their original decision.  what about the folks that were expecting the lower funding fee that close before the Nov 18th date.  this was not fair to them. 

Oct 13, 2011 11:33 AM #4
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Rainmaker
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Rebekah Radice

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