TL;DR: The VA loan funding fee in Arkansas follows the same VA-published schedule as everywhere else, effective April 7, 2023: 2.15% of the loan amount for a first-time VA buyer putting down less than 5%, 1.5% at 5% to 9.99% down, and 1.25% at 10% or more down, with a higher 3.3% rate for a second or later VA loan at the lowest down payment tier. On Benton County's $381,595 median sale price (February 2026), that fee runs from $4,770 to $8,204. Veterans drawing VA disability compensation pay nothing.
What Is the VA Loan Funding Fee in Arkansas Right Now?
The VA funding fee is a one-time charge on VA-backed purchase, construction, and refinance loans that offsets the cost of the program to taxpayers, since VA loans require no down payment and no private mortgage insurance. There is no separate Arkansas rate — the fee is set nationally by the U.S. Department of Veterans Affairs, and the schedule effective April 7, 2023 is still the current one confirmed live on VA.gov as of September 2026. For a purchase or construction loan, the fee is 2.15% of the loan amount at less than 5% down (first use), 1.5% at 5% to 9.99% down, and 1.25% at 10% or more down. A second or later VA loan raises the lowest tier to 3.3%; at 5% down or more, first use and subsequent use pay the same rate. The same percentages apply to veterans, active-duty service members, and National Guard or Reserve members alike — there is no separate Guard or Reserve tier. If you are relocating to Northwest Arkansas on a VA loan, your down payment tier matters more than your service branch.
How Much Does the Funding Fee Cost on a Northwest Arkansas Home?
Northwest Arkansas Board of Realtors MLS data puts the February 2026 median sale price at $381,595 in Benton County and $355,000 in Washington County. Applying the VA fee schedule directly to those medians shows what a VA buyer actually owes at closing. At less than 5% down, first use: $381,595 x 2.15% = $8,204 in Benton County and $355,000 x 2.15% = $7,633 in Washington County. At 5% to 9.99% down: $381,595 x 1.5% = $5,724 in Benton County and $355,000 x 1.5% = $5,325 in Washington County. At 10% or more down: $381,595 x 1.25% = $4,770 in Benton County and $355,000 x 1.25% = $4,438 in Washington County. A second or later VA loan at less than 5% down pushes the Benton County figure to $381,595 x 3.3% = $12,593 and the Washington County figure to $355,000 x 3.3% = $11,715. If you are choosing between a Bentonville-area home near Benton County's $381,595 median and a Fayetteville-area home near Washington County's $355,000 median, the funding fee at the same down payment tier runs a few hundred dollars lower in Washington County.
Who Is Exempt From the VA Funding Fee?
Veterans who receive VA compensation for a service-connected disability skip the funding fee entirely, at any down payment level, and the exemption also covers veterans who are eligible for that compensation but draw retirement or active-duty pay instead. Active-duty service members are exempt if they provide evidence of a Purple Heart on or before the loan closing date. Surviving spouses receiving Dependency and Indemnity Compensation, known as DIC, are exempt as well. None of these exemptions require a minimum down payment or a specific loan amount — they remove the fee altogether. If you fall into one of these categories, the $4,770-to-$12,593 range calculated above for Benton County, or the $4,438-to-$11,715 range for Washington County, does not apply to you. Confirm your exemption status with the VA and your lender before closing, since an undocumented exemption can still show up as a charge on your loan that you then have to get refunded.
How Does the Funding Fee Fit Into Your Total Closing Costs?
The funding fee is paid in addition to standard closing costs, not instead of them. Arkansas homebuyers paid average closing costs of $2,518 in a study published November 3, 2023, the most recent Arkansas-specific figure available, compared with a national average of $4,661 in a 2025 report covering 2024 purchase loans. Add the funding fee to the Arkansas closing cost average and, at a 10% or more down payment, a Benton County VA buyer should budget $4,770 + $2,518 = $7,288 in fee and closing costs combined, while a Washington County buyer should budget $4,438 + $2,518 = $6,956. That is cash due at closing on top of your down payment, appraisal, and prepaid items. This math matters more right now because the average 30-year fixed conventional rate was 6.71% for the week of September 3, 2026, up from 6.66% the prior week and 6.50% a year earlier — every dollar you avoid at closing, including through a larger down payment that drops your funding fee tier, is a dollar you are not financing at that rate for 30 years.
What Should You Do With These Numbers?
- Decide your down payment tier before you shop: moving from less than 5% down to 10% or more down cuts the Benton County funding fee from $8,204 to $4,770.
- Ask the VA or your lender in writing whether your disability rating, Purple Heart status, or DIC eligibility qualifies you for a full funding fee exemption, before you sign a purchase contract.
- Budget the combined total, not just one figure or the other: $7,288 in Benton County or $6,956 in Washington County at a 10% down payment.
- Weigh Benton County's $381,595 median against Washington County's $355,000 median against your commute — Bentonville and Rogers sit in Benton County near Walmart's headquarters, while Fayetteville and Springdale sit largely in Washington County near Tyson Foods.
- Call Mason Capital Group at 479-925-3333 before you go under contract, so your funding fee tier and closing cost estimate are settled before you are negotiating against a deadline.
Frequently Asked Questions
What is the current VA funding fee percentage in Arkansas?
The current VA funding fee, effective April 7, 2023 and confirmed live on VA.gov as of September 2026, is 2.15% of the loan amount for a first-time VA buyer putting down less than 5%, 1.5% at 5% to 9.99% down, and 1.25% at 10% or more down. Arkansas uses the same nationwide schedule; there is no separate state rate.
Is the funding fee different for a first VA loan versus a second one?
Only at the lowest down payment tier: a VA buyer putting down less than 5% pays 2.15% on a first VA loan and 3.3% on a second or later VA loan. At 5% down or more, first use and subsequent use pay the identical 1.5% or 1.25% rate. On Benton County's $381,595 median price, that gap is $8,204 versus $12,593.
Who is exempt from paying the VA funding fee?
Veterans receiving VA compensation for a service-connected disability, veterans eligible for that compensation who draw retirement or active-duty pay instead, active-duty service members who document a Purple Heart by closing, and surviving spouses receiving Dependency and Indemnity Compensation are all exempt from the funding fee. The exemption applies at any down payment level and removes the fee entirely.
Does the VA funding fee apply to refinancing as well as buying?
Yes — a VA-backed cash-out refinance carries the same 2.15% first-use and 3.3% subsequent-use funding fee under the schedule effective April 7, 2023. There is no reduced rate for refinance loans the way there is for a purchase loan with a larger down payment; the down payment tiers apply only to purchase and construction loans.
If you are weighing a VA purchase in Bentonville, Rogers, Fayetteville, or Springdale, Mason Capital Group will build a funding fee and closing cost worksheet for the specific property and down payment you are considering, so you know your total cash-to-close before you write an offer. Call 479-925-3333 to start that conversation.
About the author: Cameron Torabi, Principal Broker — Mason Capital Group. 30+ years of Northwest Arkansas real estate expertise; $2.4B+ in cumulative transaction activity.
Figures in this article are drawn from the U.S. Department of Veterans Affairs (VA.gov), current schedule effective April 7, 2023 and confirmed live as of September 2026; Northwest Arkansas Board of Realtors MLS data via NWA Look (February 2026); the Arvest Bank Skyline Report from the University of Arkansas Center for Business and Economic Research (H1 2026); Freddie Mac's Primary Mortgage Market Survey (week of September 3, 2026); a National Association of REALTORS analysis citing Assurance IQ (published November 3, 2023); and the LodeStar Software Solutions 2025 Purchase Mortgage Closing Cost Data Report (2024 data, released April 21, 2025).