When it comes to VA loans, there are certain closing costs that Veterans can pay – and certain closing costs that the Veteran is not allowed to pay according to the VA.
When it comes to getting an appraisal done, it is allowable for the Veteran to pay the cost of an appraisal. It is also allowed for the veteran to also pay for a second appraisal if he or she is requesting reconsideration of value.
The veteran cannot pay for an appraisal requested by the lender or seller for reconsideration of value. It is also not allowed for the Veteran to pay for appraisals requested by parties other than the veteran or lender.
Discount Points on VA Loans
It is allowable for a Veteran to pay discount points on purchase, cash-out and no cash-out refinances, as long as they are considered to be reasonable.
The Interest Rate Reduction Refinance Loans (IRRRL) may include only up to 2 points in new loan. Additional discount points must be paid in cash.
An origination point of 1% of loan amount is allowed to be paid by the Veteran. If the 1% origination point is paid by the Veteran, then there are certain other fees that cannot be paid when the 1% origination fee is paid. These fees that cannot be paid include:
- Amortization Schedule
- Application Fee
- Attorney Services (other than for title work)
- Postage and other mailing charges, stationery, telephone calls, and other overhead.
- Processing Fee
- Closing Fee or Settlement Fee
- Commitment Fee or Marketing Fees
- Conveyance Fees or Preparing Loan Papers
- Sales Commission
- Protection Warranties (Homeshield, Ticor, etc)
- Document Preparation Fee
- Escrow Fees or Charges
- Interest rate lock-in Fees
- Trustee’s Fees or Charges
- Lender’s Appraisals
- Truth In Lending Disclosure Statement preparation Fee
- Tax Service Fee Transfer Fee
- Notary Fee
With VA loans, there are many fees that have different rules based on what the VA allows. If you have questions about whether or not a particular fee is allowed on a VA loan, be sure to contact your loan officer to learn the right answer.