VA Loan Closing Costs: What Veterans in Solano County Should Expect to Pay

Last updated April 12, 2026 by Tim Stacey, Stacey Solutions powered by Xpert Home Lending, Inc NMLS 2179191.

Breaking Down VA Loan Closing Costs

VA loan closing costs fall into three categories: the VA funding fee, lender charges, and third-party costs. Understanding each category helps you anticipate what you will owe at closing and identify opportunities to reduce your out-of-pocket expense.

The VA funding fee. This is typically the largest single closing cost on a VA loan. For 2026, the funding fee on a purchase loan is 2.15% for first-time VA loan users with zero down payment, and 3.3% for subsequent use. On a $500,000 purchase, the first-time fee is $10,750. If you make a down payment of 5% or more, the fee drops to 1.5% (first use) or 1.25% (10%+ down). The funding fee can be rolled into the loan so you do not pay it out of pocket.

Veterans with a service-connected disability rating of 10% or higher are completely exempt from the funding fee. This exemption saves thousands of dollars and is one of the most significant financial benefits available to disabled veterans. If you have a pending disability claim, you may be able to get the fee refunded retroactively once your rating is approved.

Lender charges. The VA limits the origination fee to no more than 1% of the loan amount. This cap protects veterans from excessive lender charges. Some lenders charge the full 1%, while others charge less or offset it with lender credits. The origination fee covers the lender’s cost of processing your loan.

Third-party costs. These are charges from companies other than your lender that provide services needed to close the loan. They include:

The VA appraisal fee, which typically runs $600 to $800 in Solano County. Title insurance, which protects the lender against title defects and costs approximately $1,500 to $2,500 depending on the loan amount. Escrow fees, which cover the closing agent’s services and typically run $1,000 to $1,500. Recording fees paid to the county, usually $75 to $200. Credit report fees, typically $50 to $100. Flood certification, around $15 to $25.

Fees the VA Does Not Allow on VA Loans

One of the advantages of the VA loan program is that certain fees are prohibited. These are costs that conventional and FHA borrowers typically pay but VA borrowers do not:

Attorney fees charged by the lender. Prepayment penalties. Broker commissions charged to the borrower (on VA loans, these are paid by the lender). Real estate settlement charges beyond what the VA allows. Document preparation fees charged separately from the origination fee.

These prohibitions keep VA closing costs lower than they would be on a comparable conventional loan. It is one of the ways the VA program protects veterans throughout the home buying process.

How to Reduce Your VA Loan Closing Costs

Even within the VA’s cost structure, there are strategies to minimize what you pay at closing:

Negotiate seller concessions. On a VA loan, the seller can contribute up to 4% of the purchase price toward your closing costs. In many Solano County transactions, especially when the market favors buyers, sellers agree to cover some or all of the buyer’s closing costs. I help my clients structure offers that include reasonable seller concession requests based on current market conditions in Vacaville, Fairfield, and surrounding areas.

Request lender credits. Your lender can provide credits to offset closing costs in exchange for a slightly higher interest rate. This is the same concept as a no-cost loan. If you want to minimize cash at closing and are comfortable with a modestly higher rate, lender credits can cover a significant portion of your costs.

Roll the funding fee into the loan. Instead of paying the funding fee at closing, you can add it to your loan balance. This increases your monthly payment slightly but eliminates a large upfront cost. On a $500,000 loan with a $10,750 funding fee, rolling it in adds roughly $65 per month to your payment on a 30-year loan.

Shop third-party services. You can shop for title insurance, home inspections, and other services listed in Section C of your Loan Estimate. Getting quotes from multiple providers can save hundreds of dollars.

Verify your funding fee exemption. If you have any service-connected disability rating of 10% or higher, confirm that the exemption is reflected on your Certificate of Eligibility before closing. This saves the entire funding fee amount.

What VA Closing Costs Look Like in Solano County

Here is an approximate breakdown for a $525,000 home purchase in Solano County using a VA loan with zero down payment (first-time use):

VA funding fee (2.15%): $11,288. Lender origination fee (up to 1%): $5,250. VA appraisal: $700. Title insurance: $1,800. Escrow fee: $1,200. Recording fees: $125. Credit report: $75. Flood certification: $20. Prepaid items (insurance, taxes, interest): $3,000 to $5,000.

Total estimated closing costs: approximately $23,500 to $25,500 including prepaids and the funding fee. Without the funding fee (disabled veteran exemption), total costs drop to approximately $12,200 to $14,200.

If the seller contributes 3% toward closing costs ($15,750), and the funding fee is rolled into the loan, the veteran’s out-of-pocket cash at closing could be as low as $6,000 to $8,000 even without a disability exemption. With the exemption, out-of-pocket costs could be minimal or zero with seller concessions covering the remaining costs.

The 2026 conforming loan limit in Solano County is $832,750, so this scenario and most purchases in the area fall well within conforming loan guidelines.

Frequently Asked Questions About VA Loan Closing Costs

Can I use a VA loan with zero money at closing?

It is possible in some situations. If the seller covers your closing costs through concessions and the funding fee is rolled into the loan (or waived due to disability), your out-of-pocket expense at closing can be zero or very close to it. However, you will still need earnest money when you submit your offer, which is typically refundable if the deal falls through within contingency periods.

Are VA closing costs higher or lower than conventional closing costs?

Without the funding fee, VA closing costs are typically lower because the VA caps the origination fee and prohibits certain charges that conventional loans allow. With the funding fee included, total VA costs can be comparable to or slightly higher than conventional costs. However, VA borrowers save significantly by not paying PMI, which is an ongoing monthly cost that conventional borrowers with less than 20% down payment must pay.

Can the seller pay the VA funding fee?

Yes. The VA funding fee is considered a closing cost, and the seller’s 4% concession limit can include the funding fee. If the seller agrees to pay 4% of a $500,000 purchase price ($20,000), that amount can cover the funding fee and a significant portion of other closing costs.

When is the VA funding fee due?

The funding fee is due at closing, but it can be financed into the loan so you do not need to pay it out of pocket. If you finance it, the fee is added to your loan balance and you pay interest on it over the life of the loan. For a $10,000 funding fee financed at 6.5% over 30 years, the additional monthly cost is approximately $63.

Do VA closing costs vary by location?

Yes. Third-party costs like title insurance, escrow fees, and appraisal fees vary by location. In Solano County, these costs tend to be moderate compared to more expensive California markets like the Bay Area. The VA funding fee is the same regardless of location, and lender fees are subject to the same VA caps everywhere.

Let’s Review Your Closing Cost Estimate

If you are a veteran or active-duty service member buying a home in Vacaville, Fairfield, Suisun City, or anywhere in Solano County, I will provide a detailed closing cost estimate so you know exactly what to expect. Call or text me at (707) 317-1364 to get started.