When veterans use the VA Home Loan Guarantee Program one of the benefits is the lower and limited closing costs. Because the Home Loan Program is regulated by the VA there are only certain fees that are allowed to be charged to borrowers. The VA has a list of approved lenders that must be used by borrowers because they know these lenders will abide by the fee rules.
Even though the fees for a VA loan are comparable to other traditional lenders, some of the fees that are not allowed by the VA include:
• Application fees
• Pre-payment penalty fees
• Processing fees
• Escrow account fees
• Fees to attain lower interest rates
• Closing costs are comparable with other financing types (and may be lower).
There may be more fees that the VA does not allow. The rules of the VA Home Loan Guarantee Program change frequently. To get the most update information on the Va home Loan allowed fees for borrowers go to http://www.homeloans.va.gov/ or consult your VA approved lender.
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