If you take the time to analyze different mortgage types, you might discover that a VA loan is the right option for you. If so, this is a fantastic choice of loan program, as it offers many benefits. Next, though, you should research the fees and expenses tied to VA loans, so you can get a good idea of how much the loan will cost. Here are several things to know about the fees and expenses associated with VA loans.

There is a mandatory funding fee

VA loans are unique as they are backed by the Department of Veteran's Affairs (VA). Many mortgage lenders offer VA loans, but it is not the lender backing them — it is the VA. Lenders have guidelines to follow when approving these loans, but the VA also has a rule. The rule is that anyone who takes a loan must pay a funding fee.

The cost of the funding fee is a percentage of the amount of money you borrow, and it varies by the amount of your down payment. When you put no money down, your funding fee is 2.3%. When you put 5% down, your funding fee is 1.65%. When you put 10% down, you pay just 1.4% for the funding fee.

There are standard closing costs you must pay

The lender that issues the loan will also charge fees for the loan, and these are called closing costs. There are some fees that lenders cannot charge with VA loans, but there still are a lot of fees that they can charge.

One fee to expect is for the appraisal. Every home sale that involves a loan requires an appraisal. You should also expect to pay the fees for the following things:

• Your credit report
• Loan origination
• Title insurance
• Property taxes
• Home insurance

These fees are all standard with VA loans, but lenders cannot charge fees for settlement charges or prepayment penalties.

You have options for paying the closing fees

Now that you understand the types of fees you will pay, you should learn your options for paying them. The first option is to pay cash for them. If you have cash, you could use it to pay the fees in full. Two, you could roll them into the loan. You can include any of the fees listed here in your loan. While this increases your loan amount, it decreases the amount you need upfront.

Do you have questions about VA loans? If so, contact a mortgage lender to learn more.