Are VA Funding Fees Going Up in 2026? What North Texas Buyers Should Know

As of September 23, 2026, VA loan funding fees have not changed. The first-use rate with less than 5 percent down remains 2.15 percent, the subsequent-use rate remains 3.30 percent, and the IRRRL streamline refinance fee remains 0.50 percent. Congress is debating H.R. 9237, which would raise two VA loan fees, but the bill is not law, and no veteran should make a purchase decision based on a headline about a change that has not happened.

What Is the VA Funding Fee and Why Does It Exist?

The VA funding fee is a one-time fee paid on many VA-backed home loans. It helps offset the cost of the VA home loan program to American taxpayers, which is part of why eligible borrowers can buy with no down payment and no monthly private mortgage insurance. The fee is charged at closing, and it can generally be paid in cash or included in the loan amount, depending on the lender and the program. It is separate from title, appraisal, and lender fees, and it is separate from the property taxes, HOA dues, and special district assessments that run with a North Texas property.

Not every VA borrower pays the fee. Several groups are exempt, and the exemptions matter for budget planning in Denton County, where a 2.15 percent fee on a $600,000 home is roughly $12,900, and a 3.30 percent subsequent-use fee is roughly $19,800. Those figures are simple arithmetic illustrations based on the current rates, not a quote, and the exact amount depends on the loan amount and your use and exemption status.

Current 2026 VA Funding Fee Rates

These are the current purchase-loan rates for loans closing on or after April 7, 2023, as set by VA Circular 26-23-06. The schedule is set through November 14, 2031 unless changed by law. Rates are the same for Regular Military, Reserves, and National Guard borrowers.

The full fee table, including cash-out refinance and manufactured home rates, is on the official VA funding fee page. VA eligibility, entitlement, lender approval, appraisal, and the individual transaction always affect the final numbers, so use current official VA guidance and your VA lender for your specific situation.

Who Is Exempt From the VA Funding Fee?

Under current VA rules, the following borrowers generally do not pay the funding fee:

• Veterans receiving VA compensation for a service-connected disability, regardless of the rating percentage.
• Veterans who would be entitled to that compensation but instead receive military retirement pay or active-duty pay.
• Surviving spouses of veterans who died in the line of duty or from a service-connected disability who receive Dependency and Indemnity Compensation (DIC).
• Active-duty service members who have been awarded the Purple Heart.
• Active-duty service members who, before the loan closing date, have received a proposed or memorandum disability rating showing eligibility to receive compensation as a result of a pre-discharge claim.

Eligible exempt borrowers should confirm their status with their lender before closing. If you believe you were charged a VA funding fee when you should have been exempt, contact your lender or the VA Regional Loan Center. VA has a process for reviewing funding-fee refunds, and VA Form 26-8937 may be used in certain situations to verify VA benefit and funding-fee exemption status. See the official VA funding fee and closing costs page for current details.

The Proposed Change: What H.R. 9237 Actually Says

H.R. 9237, the Take Care of America's Veterans Act, is a bill introduced in the U.S. House of Representatives on June 10, 2026. As part of funding expanded veterans benefits, it proposes two fee increases in Section 104(b):

• The IRRRL streamline refinance funding fee would rise from 0.50% to 1.42% of the loan amount.
• The VA loan assumption fee would rise from 0.50% to 1.00% of the loan balance.

News about a proposed fee increase gets attention, and this proposal was reported in the military press in mid-September 2026. The honest read for a buyer is narrow: no purchase-loan funding fee is proposed to change, the two proposed increases target refinancing and assumptions, and none of it is in effect. A pending bill is information to track, not a reason to accelerate or delay a North Texas home purchase on its own.

The Funding Fee and Your Federal Taxes

In February 2026, VA announced that borrowers who pay a VA funding fee on a home purchase can generally deduct the fee on their federal tax return for the year it was paid, when itemizing. This is a federal tax matter, not a Texas-specific one, and not every situation is the same. I am not a tax adviser, so treat this as a lead to confirm with a qualified tax professional and the official VA News announcement.

What This Means for VA Buyers in Northlake and Argyle

As the spouse of a veteran and a North Texas real estate broker who works with military families daily, I know the funding fee is one line in a larger cost picture, and it is the line most likely to be misunderstood. Here is how it fits a real North Texas purchase.

First, budget it. On a zero-down VA purchase in a Denton County community, the funding fee can be a significant one-time loan cost, often in the five figures. It can generally be financed, which keeps cash in your pocket but increases the loan balance, so compare the trade-off with your lender rather than assuming either choice is automatic.

Second, check your exemption before closing, not after. Many military and veteran families do not realize a service-connected disability rating paired with VA compensation can remove the fee entirely. With the maintenance of a full picture, your Military and Veterans page walks through the wider VA loan process start to finish, and my VA Loans in Texas guide covers eligibility, entitlement, and the Escape Clause in one place.

Third, do not let a pending bill drive your timing. A home purchase in Northlake, Argyle, or anywhere in Denton County should follow the market, your family's needs, the community, and the school district, not a proposed fee with no effective date. If anything, the current schedule being set through November 14, 2031 means the rates you see today are not changing on their own.

VA Loan Assumptions and the Proposed Fee Change

VA loans are generally assumable, meaning a qualified buyer who meets VA eligibility and the lender's credit requirements can take over an existing VA loan rather than originate a new one. The VA charges a funding fee for an assumption, currently 0.50% of the unpaid loan balance, paid by the person assuming the loan.

This matters in two ways for North Texas. If you are buying and the seller has an assumable VA loan, an assumption can be a strategy worth exploring with your lender, especially when current rates are above the existing loan's rate. And if you later sell a home you bought with a VA loan, the assumability of the loan can make your home more attractive to a qualified VA buyer, an angle my Selling Guide covers in depth.

Under H.R. 9237, the assumption fee would double to 1.00%, but that change is not in effect and the bill has not passed. Track the status, understand what an assumption involves, and let the numbers for your specific transaction guide the decision.

What Relocating Military Families Should Verify

If you are moving to North Texas on orders or in a PCS, retirement, or separation transition, add these funding-fee checks to your move plan:

• Confirm your Certificate of Eligibility and your entitlement status, full or remaining, with the VA or your VA lender before house hunting.
• If you receive VA compensation for a service-connected disability, confirm your funding-fee exemption in writing before closing, and know that if the fee was charged in error, VA's refund review begins with your lender or the VA Regional Loan Center.
• Budget the fee together with property taxes, HOA dues, MMD or PID and MUD assessments, insurance, and maintenance, because the mortgage payment is never the whole cost in Denton County. My VA home loans and local costs guide breaks down those lines by community.
• Keep occupancy in mind: a VA purchase loan is generally for a home the qualifying borrower will occupy as a primary residence within a reasonable time after closing, which matters when you are buying before your move-in date.
• If you are buying from out of state or on a tight timeline, plan the closing around your move. My remote home buying guide and the North Texas relocation guide cover buying without multiple trips, and my guide to the 2026 VA appraisal rule changes explains the appraisal timing that fits into a PCS move.
• Ignore fee-update headlines unless they cite an official source and an effective date. As of September 23, 2026, there is no change to verify, only a bill to track.

Local Considerations in Northlake, Argyle, and Denton County

The funding fee applies the same way across North Texas, but the transactions around it differ by community. In Northlake, master-planned communities like Pecan Square mix new construction with Municipal Management District assessments, while Argyle and its surrounding areas offer Argyle ISD schools, estate lots, and communities such as Harvest and Canyon Falls with their own special district structures. Compare the full cost of ownership, not just the purchase price, because the fee, the taxes, and the district assessments all move your monthly number.

For new construction, keep two points in mind. The builder's on-site sales representative represents the builder, not you, and independent buyer representation can help you evaluate communities, builders, lots, incentives, contracts, and timelines. And never assume a builder accepts VA financing or applies incentives to VA loans; verify with the specific builder and your VA lender, because acceptance and incentive policy vary. My new construction guide walks through those decisions.

Whether you are weighing Northlake versus Argyle, comparing new construction with resale, or simply establishing a budget, the funding fee is a known quantity. The proposed changes are not. Plan on the number you can verify today, and revisit the bill only when it becomes law.

Frequently Asked Questions

Are VA funding fees going up in 2026?

No increase is in effect as of September 23, 2026. H.R. 9237 proposes to raise the IRRRL streamline refinance fee and the loan assumption fee, but the bill has not passed the House and no fee has changed.

What is the current VA funding fee for a first-time VA buyer?

For a first-use purchase loan with less than 5 percent down, the fee is 2.15% of the loan amount. It drops to 1.50% at 5 percent or more down, and 1.25% at 10 percent or more down, under the schedule in effect since April 7, 2023.

Who is exempt from the VA funding fee?

Borrowers receiving VA compensation for a service-connected disability (any rating), veterans who would receive that compensation but for military retirement or active-duty pay, surviving spouses receiving DIC, and active-duty Purple Heart recipients generally do not pay the funding fee.

Can I finance the VA funding fee into my loan?

For many purchase loans, the funding fee can be paid at closing or included in the loan amount. The choice affects your loan balance and monthly payment, so review both with your VA lender before deciding.

Is the VA funding fee tax deductible?

VA announced in February 2026 that eligible borrowers who pay a VA funding fee on a home purchase can generally deduct it on their federal tax return for the year paid, when itemizing. Confirm your situation with a qualified tax professional and the official VA guidance.

What is the current VA loan assumption fee?

The assumption fee is 0.50% of the unpaid loan balance, paid by the person assuming the loan. H.R. 9237 proposes to double it to 1.00%, but that change is not in effect as of September 23, 2026.

Should I rush my North Texas home purchase because of the proposed fee increase?

No. The proposed fee increase targets refinancing and assumptions, is not limited to purchases, and is not law. Buy when your community, school district, commute, timing, and total cost of ownership line up, and track the bill only as background.

Conclusion

As of September 23, 2026, the VA funding fee schedule is unchanged: 2.15% first use below 5 percent down, 3.30% subsequent use, 0.50% for streamline refinances, and 0.50% for assumptions. The proposed increases in H.R. 9237 are real but not law, and they do not touch purchase-loan rates. For VA buyers in Northlake, Argyle, and across Denton County, the practical move is to confirm your exemption status, budget the fee as part of your total cost of ownership, and let verified numbers, not headlines, drive the decision.

Explore the North Texas Real Estate Answer Center for direct answers and additional local guides.

If you are a veteran, active-duty service member, eligible surviving spouse, or other qualified VA buyer comparing communities in Northlake, Argyle, Flower Mound, or a surrounding North Texas town, I would welcome the chance to talk through the full cost picture and what to verify before you make an offer.

Sources

• U.S. House of Representatives, H.R. 9237, Take Care of America's Veterans Act, introduced June 10, 2026; status as of September 23, 2026: Congress.gov bill page.
• U.S. Department of Veterans Affairs, Circular 26-23-06 and Exhibit B, Loan Fee Rates, effective for loans closing on or after April 7, 2023: VA Circular 26-23-06.
• U.S. Department of Veterans Affairs, VA funding fee and closing costs (reviewed September 23, 2026).
• U.S. Department of Veterans Affairs, VA News, February 18, 2026: Home loan borrowers can now deduct funding fees.
• U.S. Department of Veterans Affairs, VA home loans and home-loan eligibility.
• Army Times / Military Times, September 15, 2026: Proposed VA loan fee hike could make refinancing more expensive for some borrowers.
• Town of Northlake, special districts, for local MMD, PID, and water district context.

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