i. How and When to Remit the Funding Fee to VA

Lenders must remit the VA funding fee via the FFPS within 15 calendar days of loan closing. 

Lenders paying the fee more than 15 days after loan closing will automatically be assessed a 4% late fee.  Fees paid more than 30 days late will automatically be assessed an interest charge in addition to the late fee.

j. Refunding Overpayments to the Veteran

A refund is appropriate if

·   an exempt veteran paid a funding fee, or

·   a miscalculation of the fee caused an overpayment.

Using the VA FFPS, lenders can make appropriate corrections that may result in refunds being due. 

If the veteran was overcharged, the following applies:

·   A veteran who paid cash for the funding fee receives a cash refund for the amount of the overpayment.

·   In the case of a veteran who paid the funding fee out of loan proceeds, the lender must apply the overpayment against the loan balance.  Submit evidence to VA that the refund was applied to the loan’s principal balance.