The answer is VA Funding Fee or simply funding fee. It is general that all Veterans using the VA Home Loan Guaranty benefit must pay a funding fee. This lessens the loan's cost to taxpayers since that a VA loan requires no down payment and has no monthly mortgage insurance. The funding fee is a percentage of the loan amount which contrasts based on the type of loan and your military category, if you are a first-time or subsequent loan user, and whether you make a down payment. You have the choice to finance the VA funding fee or pay it in cash, but the funding fee must be paid at closing time.