📌 Key Takeaway: VA loans limit which closing costs veterans can be charged — certain fees are simply non-allowable for the borrower to pay, which can make VA closing costs lower than conventional loans in practice.
Non-Allowable Fees
The VA prohibits charging veterans for certain costs, including attorney fees for the lender's benefit and some other administrative charges — these must be covered by the lender or seller instead.
Costs VA Borrowers Typically Still Pay
- Loan origination fee (capped at 1% of the loan amount).
- Appraisal fee (VA appraisals have specific requirements beyond a standard appraisal).
- Title insurance and recording fees.
- The VA funding fee, unless exempt.
Seller Concessions
VA rules allow sellers to contribute up to 4% of the loan amount toward the buyer's closing costs and other expenses, on top of paying for standard items like real estate commission — a meaningful negotiating tool in a buyer's market.
This page is for educational purposes and isn't personalized financial or tax advice. Figures, rates, and program details change frequently — confirm current terms directly with lenders, tax professionals, or the IRS before acting.