The department of Veterans Affairs has announced changes to loan funding fees effective 1 October, 2011. For VA home loans closed on or after that date, the new rates apply. At the time of this writing, the VA loan funding fee for first time use, with a .5% or less down payment is 2.14% for active duty veterans and 2.40% for Guard and Reserve veterans who qualify. In October, the rates are lowered to 1.40% and 1.65% respectively. Rates are also lowered for those making down payments of 5% or more, and 10% or more. VA loans for subsequent use currently have a funding fee of 3.30% for active duty and Guard/Reserve members. After October 1, 2011 those fees-for those making a down payment of 5% or less-will drop to 2.80% for one year, then drop again October 1, 2013 when the VA loan funding fee for second time use becomes 1.25%.