How Much Are VA Loan Closing Costs? (2026)

How closing costs work

Closing costs are fees and expenses that homebuyers and sellers incur when a real estate transaction is finalized. These costs are separate from the purchase price of the property and can vary based on factors such as location, the type of property and the terms of the mortgage.

Closing costs are paid at the closing of the real estate transaction, which is the final step in the homebuying process. The exact timing can vary, but it is usually within a few days to a few weeks after an offer is accepted.

These costs are typically between 2% and 5% of the home’s purchase price and include expenses such as the loan’s origination fee and any appraisal and inspection fees.

VA loan closing costs

There are some closing costs that are specifically associated with VA loans, such as the VA funding fee, VA appraisal fee and various inspection requirements, depending on the property.

VA funding fee

VA loans typically require a funding fee, which is a one-time payment to the Department of Veterans Affairs. The percentage of the funding fee can vary depending on factors such as your military service, down payment amount and whether it's your first or subsequent VA loan.

For example, for a first-time VA loan borrower with no down payment, the funding fee is 2.15% of the loan amount as of publishing. However, this rate can be lower if you make a down payment.

Origination fee

While other types of mortgages also have origination fees, with VA loans, the VA limits the origination fee to 1% of the loan amount. The origination fee is charged by the lender to cover the cost of processing your loan application.

VA appraisal fee

VA loans require a VA appraisal to determine the property's value and ensure it meets the VA's minimum property requirements. This appraisal cannot be requested by the lender or seller for reconsideration of the home’s value.

The cost of the VA appraisal varies depending on location and property type but can range from $500 to over $1,000 as of publishing for a single-family home.

VA inspection fees

Depending on where your home was located and when it was built, the VA has specific inspection criteria you may need to meet — each of which may come with its own cost.

Examples of possibly required inspections include:

• Wood-destroying insects: In some regions with a history of termite infestations, VA loans may require a termite inspection to ensure the property is free from damage or infestations. The cost can vary based on the location and the extent of the inspection required.
• Well and septic systems: If the property relies on a private well for water or a septic system for sewage disposal, the VA may require inspections of these systems to ensure they meet safety and functionality standards. Costs can vary based on the complexity of the systems and local requirements.
• Lead-based paint: If you're buying a home built before 1978, the VA may require a lead-based paint inspection. The cost of a lead-based paint inspection can vary, but it is essential for the safety of occupants, particularly if children are living in the home.

» MORE: VA loan benefits

Nonallowable VA fees

One of the key advantages of VA loans is they have protections in place to prevent certain fees and costs that are typically associated with traditional mortgage loans.

Here are some of the nonallowable fees with VA loans and what they mean for you:

Other closing costs

There are a number of other closing costs that apply to both VA loans and conventional loans:

• Property taxes: Property taxes are based on your home's assessed value and the local tax rate. Lenders may require you to set aside funds for property taxes in an escrow account, typically covering six months' worth.
• Homeowners insurance: Homeowners insurance protects your home from damage or loss due to events such as fires, theft and natural disasters. It is a requirement for VA loans. The cost varies depending on your location, the value of your home, the coverage level you choose and factors such as your claims history and credit score.
• Recording fees: Government agencies charge fees for legally recording the deed and mortgage related to your home loan. These fees may be paid by the buyer or seller, depending on your agreement. You can budget around $125 for these fees.
• HOA fees: If your home is part of a homeowners association (HOA), you'll typically have monthly or annual dues. These fees might be included in your closing costs. Monthly HOA fees can average around $200, but they vary.
• Discount points: Discount points, or mortgage points, are optional fees you can pay upfront to lower your interest rate. Each point typically costs 1% of the loan amount.
• Credit check fees: Lenders may charge a fee for running a credit check as part of the loan application process. This cost can vary.
• Title search fees: A title search ensures the property's title is clear of any legal issues. The cost varies depending on your location and the complexity of the search.

Reducing VA closing costs

It is possible to reduce the amount of your closing costs, both with a conventional mortgage and with a VA loan.

"Sometimes, the seller may assist with some or all of the closing costs. The buyer's agent can request this in the offer presented to the seller. Additionally, it's advisable to inquire with the loan officer about the possibility of financing the funding fee into the loan, as this can help alleviate the burden of closing costs,” said Priscilla L. Hammond, a real estate agent at Desari Jabbar Realty Group in the Atlanta area.

“Exploring local housing agencies and nonprofit organizations for potential assistance programs that the buyer qualifies for is also a prudent step. Furthermore, certain lenders provide a 'no closing cost VA loan' option, albeit with slightly higher interest rates."

How to read a VA Loan Estimate

When you're in the market for a mortgage, understanding the details of different loan offers is crucial. A VA Loan Estimate is a concise three-page document that breaks down the essentials of your mortgage. Here’s what’s included:

• The basics: Essential information, such as the date the estimate was issued, the buyer's and prospective property addresses and loan terms. Pay attention to whether the interest rate is locked in, as most lenders won't do this until you commit to the loan.
• Loan details: Vital information about your loan, including the total mortgage amount, interest rate and monthly principal and interest payment.
• Projected payments: Your monthly principal, interest, taxes and insurance (PITI). When comparing quotes, focus on the differences in principal and interest, as taxes and insurance are typically not set by the lender. Additionally, find out if taxes and insurance will be escrowed.
• Closing costs: There will be a detailed breakdown of all your closing costs. The left side lists actual costs from the lender, while the right side breaks down costs related to taxes and insurance (not set by the lender). Pay attention to things like origination charges and services you can or cannot shop for.
• Lender information: The name of the lender and mortgage originator. You'll also find crucial figures like the mortgage's annual percentage rate (APR) and total interest percentage (TIP).
• Other considerations: Check for details about late payment policies and whether the lender intends to service the loan or sell it off after closing.

» MORE: VA loan requirements

FAQ

Bottom line

VA loans have many advantages, including limits on fees and a ban on certain charges. However, like conventional home loans, VA loans do require some closing costs. These costs can include origination fees, title fees and recording fees. Closing costs typically add up to 2% to 5% of the home's sale price.