VA Itemized Fees and Charges Policy & Procedure

Overview

Department of Veteran Affairs (VA) loan programs are available for service members and veterans (collectively “veterans”) only. VA regulations limit the loan fees that a veteran can pay to obtain a loan. Lenders must strictly adhere to the limitations on veteran-paid fees and charges when making VA loans.

Policy

Refer to the following documents for detailed policy information and the VA fee matrix:

·       VA Allowable Fees Policy

·       VA Allowable Fee Matrix

VA State Deviation Policy

Always refer to the VA State Deviations Table for an exceptions to fees in the “Included in the 1% Limit” category.

Seller and Lender Credits

If the total of fees subject to the VA 1% limit exceed the threshold, an itemized Lender Credit (PE) and/or an itemized Seller Credit may be applied to those fees to bring the total within the 1% limitation.

·       When a Seller Credit is applied to a fee that is subject to the 1% limit, the fee will be excluded from the 1% calculation.

·       When a Lender Credit is applied to a fee that is subject to the 1% limit, the fee will be excluded from the 1% calculation only if the Lender Credit is the result of a pricing exception (PE).

·       When a Lender Credit from premium pricing (rate rebate) is applied to a fee that is subject to the 1% limit, the fee will NOT be excluded from the 1% calculation.

Fees Paid by Lender

If the total of fees subject to the VA 1% limit exceed the threshold, after applying available Lender Credits (PE) and/or available Seller Credits, loanDepot Wholesale (LDW) will allow up to $500 in excess fees to be ‘Paid by Lender’ without additional authorization. 

Any amount of fees subject to the VA 1% limit that exceed $500 will need to be reduced and/or Paid by Lender with required authorization

Itemization of Fees

VA requires all allowable fees and charges to the borrower and any lender/seller credits must be listed in the appropriate column(s) on the Closing Disclosure (CD). Fees charged to the veteran must be listed in the “Borrower-Paid”, seller credits in the “Seller-Paid” and lender credits placed in the “Paid by Others” columns. A separate itemized list of credits and charges are not acceptable.

CD example / instructions

V.I.E 07.02.2019