James, a disabled veteran exempt from the VA funding fee, purchases a home in Fort Worth for $350,000 using a VA loan with no down payment. A comparable non-exempt first-time veteran would pay a 2.15% funding fee. What is the dollar amount James saves, and what is his total loan amount?
Correct Answer
A) Saves $7,525; total loan $350,000
A non-exempt veteran would pay $350,000 × 2.15% = $7,525 in funding fees. James is exempt, so he saves $7,525 and his total loan is simply $350,000 with no fee added. In Texas, this is secured by a deed of trust.
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The secondary mortgage market is where existing mortgage loans are bought and sold between lenders, investors, and government-sponsored enterprises (GSEs) like Fannie Mae, Freddie Mac, and Ginnie Mae.
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