ALLOWABLE CLOSING COSTS
A Veteran, Service Member or Surviving Spouse may pay any of the following reasonable closing costs and fees:
1% origination fee for purchase and cash-out loans, the origination fee is calculated using the total loan amount, including the financed funding fee
For IRRRLs, the origination fee is calculated using the payoff minus any cash payments by the veteran, if applicable
Reasonable discount points: Brokers may charge only those discount points required to buy down the loan interest rate – Correspondents/VA Automatic customers are exempt from this requirement, however, the discount points charged must be reasonable and customary
VA appraisal fee – The veteran may not pay a fee higher than the maximum allowable appraisal fee for the state in which the property is located – See VA Appraisal Fee Schedules
VA compliance inspector fees – only if required by the NOV (Notice of Value)
Recording fees
Taxes and stamps
Credit report fees – $50 credit evaluation fee may be paid in lieu of the credit report fee for automated underwriting approvals
Pre-paid items
Insurances (hazard and flood, when required)
Flood zone determination
Well and septic inspection fees
Survey, if required by lender or veteran, except for surveys of condominiums
Title insurance, title examination, title endorsement, title policy, title search
Environmental protection lien endorsement
Express mail fees for refinances if the saved per diem interest cost to the veteran will exceed the cost of the special handling – provide the Invoice if over $50
VA funding fee
Mortgage Electronic Registration System (MERS) fee
Closing protection Letter – not to exceed $35
Fraud protection report
Termite Inspection Fee/Repairs/Clearance Report provided the loan is a refinance
NON-ALLOWABLE BORROWER-PAID CLOSING COSTS
The Veteran, Service Member or Surviving Spouse may NOT pay any of the fees listed below, but the seller or lender may pay the non-allowable fees. However, if no origination fee is charged and the fee is not listed in the section below that itemizes fees the Veteran, Service Member or Surviving Spouse may never pay, the Veteran, Service Member or Surviving Spouse may pay non-allowable costs up to 1% of the purchase price. The Veteran, Service member or Surviving Spouse may also pay a combination of non-allowable fees and an origination fee, provided the combination does not exceed 1% of the purchase price.
The non-allowable fees are:
Attorney fees other than for title commitments
Lenders appraisals
Lenders inspections, except construction loan inspections and inspections required on the appraisal/NOV
Loan closing or settlement fees
Doc prep, underwriting, loan application, admin or processing fees
Assignment fees
Photographs
Interest rate lock-in fees
E-Mail, fax, copying, postage, stationery, telephone or other overhead charges
Amortization schedules, Truth-in-Lending fees, etc.
Notary fees
Escrow fees or charges
Commitment fees or marketing fees of secondary purchasers
Trustee fees
Fees charged by third parties, regardless of affiliation with lender
Tax service fees
Termite inspection fee for a purchase transaction
Attorney fee that benefits the lender
Broker fee
Brokerage fees or commissions charged by real estate agents or real estate brokers in connection with a VA loan when the payoff states a pre-payment penalty is due, veterans may pay pre-payment penalties out-of-pocket only
FHA/VA inspection fees for builders (Normal new construction inspections of the dwelling are permitted when required by the appraiser)
Any portion of the seller’s lien(s) or short sale fees
For purchase transactions, the cost of required repairs and inspections must be paid by the seller. This policy applies to all purchases, including purchases of REO properties. VA does not permit the veteran to pay for repairs other than minor termite damage repairs
VA Loan Limits for 2015: http://www.benefits.va.gov/homeloans/purchaseco_loan_limits.asp
VA Home Loans Benefits & Eligibility: http://www.benefits.va.gov/homeloans/
KENTUCKY VA MORTGAGE LENDER 