VA Loan Closing Costs in 2026: What to Expect

The VA loan is one of the cheapest mortgage programs in America to close — but it's not zero-cost. This 2026 guide breaks down exactly what closing costs to expect on a VA loan in Hampton Roads, which fees the VA caps or prohibits, what the seller can pay (which is generous on VA loans), and how to estimate your true cash to close.

Scenario	First Use	Subsequent Use
Purchase, $0 down	2.15%	3.3%
Purchase, 5% down	1.5%	1.5%
Purchase, 10% down	1.25%	1.25%
Cash-out refinance	2.15%	3.3%
VA IRRRL streamline refinance	0.5%	0.5%
10%+ disabled veteran	EXEMPT — $0	EXEMPT — $0
Surviving spouse with DIC	EXEMPT — $0	EXEMPT — $0
Purple Heart recipient (active duty)	EXEMPT — $0	EXEMPT — $0

Funding fee can be financed into the loan amount.

What VA closing costs you can be charged

The VA limits which fees a lender can charge a VA borrower. Allowable fees include:

• Origination fee — capped at 1% of loan amount (this covers the lender's processing, underwriting, application, and document prep)
• Discount points — optional; lower the rate
• VA appraisal fee — $500–$700
• Credit report fee — $40–$80
• Title insurance (owner's + lender's policy)
• Title settlement fee — $500–$1,200
• Recording fees + Virginia grantee tax
• Pre-paid items — escrow set-up for property taxes and homeowners insurance
• Per diem interest — closing date through month-end
• Hazard insurance — first year typically paid at closing

The VA funding fee

The funding fee is the VA's primary cost. It's a one-time fee that supports the VA loan program for future veterans.

• 2.15% on first use, $0 down (3.3% on subsequent use)
• 1.5% if you put down 5%+ ; 1.25% if 10%+
• 0.5% on VA IRRRL refinances

The fee is typically financed into the loan, not paid out of pocket. Exempt if you receive any VA disability compensation, are a surviving spouse receiving Dependency Indemnity Compensation, or are a Purple Heart recipient on active duty. Full VA loan guide.

Non-allowed VA fees

The VA prohibits lenders from charging the borrower these fees on a VA loan:

• Document preparation fees beyond the 1% origination cap
• Attorney fees billed to the borrower (other than the title attorney/settlement agent)
• Brokerage / loan-finding fees
• Tax service fees
• Real estate commission paid by the buyer

If a fee on your Loan Estimate or Closing Disclosure doesn't belong, the lender must remove it before closing.

What the seller can pay

VA loans have the most generous seller-concession rules in any U.S. mortgage program:

• The seller can pay all of your closing costs
• Plus an additional 4% of the purchase price in concessions (toward funding fee, prepaid taxes/insurance, paying off your debts, etc.)

On a $325k home that's potentially $10–20k+ of buyer cash savings. Always build seller concessions into your offer.

Estimating your cash to close

Compare your Loan Estimate from at least two VA lenders. The Loan Estimate is a standardized federal form that shows:

• Loan amount and rate
• All lender fees
• All third-party fees
• Pre-paid items
• Total cash to close (including any seller concessions)

Use seller concessions aggressively — many Hampton Roads VA buyers close with $0–$3,000 of cash out of pocket. Read about the CFPB Loan Estimate.

Frequently Asked Questions

How much are VA loan closing costs in 2026?

Typically 1–3% of the loan amount, plus the 2.15% funding fee (which is normally financed into the loan). Sellers can pay all of it plus 4% in concessions, so many VA borrowers close with very little cash out of pocket.

Can sellers pay all my VA loan closing costs?

Yes — and they can pay an additional 4% of the purchase price in concessions on top of standard closing costs. This is the most generous concession allowance in any U.S. mortgage program.

What is the VA funding fee?

A one-time fee that supports the VA loan program. 2.15% on first use ($0 down), reduced with down payment, 0.5% on IRRRL refinance. Financed into the loan in most cases. Waived for veterans receiving disability compensation.

Do I have to pay the VA funding fee?

Most veterans do. Exempt: veterans receiving any VA disability compensation, surviving spouses receiving DIC, and active-duty Purple Heart recipients. Confirm exemption with your lender.

Can the funding fee be financed into the loan?

Yes — it's typically rolled into the loan amount. You don't need cash for the funding fee at closing.

What is the VA 1% origination cap?

The lender's origination fee cannot exceed 1% of the loan amount on a VA loan. This covers processing, underwriting, application, and document prep.

Are there any VA loan closing costs I cannot pay?

Yes — the VA prohibits the borrower from paying certain fees including document preparation beyond the 1% cap, attorney fees (other than title settlement), brokerage fees, and tax service fees.

How long does a VA loan take to close?

Typical purchase loan: 30–45 days. VA IRRRL refinance: 2–4 weeks (no income docs, no appraisal in most cases).

Sources & further reading

• VA — Funding Fee and Closing Costs
• VA — Eligibility for VA home loan programs
• CFPB — Loan Estimate
• VA — IRRRL refinance

Information reflects 2025-2026 conditions and rules. Always confirm current details with the relevant agency, lender, or licensed professional before relying on any specific figure or rule.