Who Pays Closing Costs on a VA Loan in Idaho?

By Gerald Robinson, President and CEO, 1st Choice Mortgage Company, LLC | NMLS #4475 | Updated November 4, 2026

On a VA loan in Idaho, the buyer pays the closing costs by default, but the seller can pay all of the veteran’s normal closing costs plus up to 4% of the home’s value in extra concessions. VA rules also bar veterans from paying certain fees at all, and veterans receiving VA disability compensation don’t pay the VA funding fee. In practice, many Treasure Valley veterans buy with zero down and little or nothing out of pocket at closing.

I have helped Idaho veterans finance homes for more than two decades, and I teach a VA loan continuing-education class for Idaho real estate agents. The questions below are the ones I hear most often from veterans and their agents in Boise, Meridian and Nampa.

Who Pays Closing Costs on a VA Loan?

The veteran is responsible for the closing costs VA allows them to pay. But closing costs on a VA purchase are negotiable, and the seller can pay any or all of them. In the Treasure Valley we regularly see sellers agree to cover a VA buyer’s costs, especially on homes that have been on the market for a few weeks.

A VA buyer’s closing costs usually fall into four groups:

• Allowable fees the veteran can pay: appraisal, credit report, title insurance, recording fees, flood certification, and a lender charge of up to 1% of the loan.
• Fees the veteran can’t pay: paid by the seller, or absorbed by the lender. See the next section.
• Prepaids and escrow setup: homeowners insurance, property taxes and prepaid interest.
• The VA funding fee: usually financed into the loan rather than paid at closing.

For a line-by-line list of every fee, see our VA allowable and non-allowable closing costs guide.

What Closing Costs Can’t a Veteran Pay?

VA rules protect veterans from paying certain charges at all (38 CFR 36.4313). These fees can still exist on the transaction, but the seller or lender has to pay them. Common examples:

• The title company’s settlement or escrow fee
• Lender processing, underwriting and similar fees, when the lender is already charging the 1% flat fee
• The seller’s real estate agent commission. A veteran may pay their own buyer’s agent only under VA’s buyer-broker fee rules; see how commissions work on VA loans.
• Prepayment penalties, which VA loans never have

If one of these shows up on your Loan Estimate as a buyer charge, ask your lender about it before you sign.

How Much Can the Seller Pay on a VA Loan?

This is the most misunderstood part of VA closing costs, so it helps to separate two things:

1. Normal closing costs such as the appraisal, title insurance and recording fees. The seller can pay all of them, and they do not count toward any limit.
2. Seller concessions are extras beyond normal closing costs. These include paying the VA funding fee, prepaid taxes and insurance, paying off a buyer’s debt, or a credit for a rate buydown. Concessions are capped at 4% of the home’s reasonable value, meaning the VA appraised value.

On a home that appraises at $450,000, the seller could pay every normal closing cost and still contribute up to $18,000 in concessions.

Can the Seller Pay the VA Funding Fee?

Yes. The seller can pay the veteran’s VA funding fee, but it counts as a concession toward the 4% limit. Most veterans who pay the fee choose to finance it into the loan instead, which keeps it out of their cash to close.

For a first-time VA purchase with no down payment, the funding fee is currently 2.15% of the loan amount; for subsequent use, it’s 3.3% (VA funding fee and closing costs). See our VA funding fee guide for Idaho for every rate.

Can You Roll Closing Costs Into a VA Loan?

On a VA purchase, no, with one main exception: the VA funding fee can be financed into the loan. Other closing costs have to be paid in cash, by the seller, or through a lender credit.

The rules are different on a refinance. With a VA streamline refinance (IRRRL), closing costs can generally be included in the new loan amount.

If you’d rather not bring cash to closing on a purchase, the two tools that work are a seller credit and a lender credit. A lender credit means accepting a slightly higher interest rate in exchange for the lender paying some of your costs.

Do Disabled Veterans Pay Closing Costs?

Disabled veterans who receive VA disability compensation don’t pay the VA funding fee, but they still have the other normal closing costs. The funding fee is usually the largest single cost on a VA loan, so the exemption is significant: about $9,675 on a $450,000 first-use loan.

You’re exempt from the funding fee if you:

• Receive, or are entitled to receive, VA compensation for a service-connected disability
• Are a surviving spouse receiving Dependency and Indemnity Compensation (DIC)
• Are an active-duty service member who has received the Purple Heart
• Have a pre-discharge rating or memorandum showing eligibility for compensation

Your Certificate of Eligibility (COE) shows your funding fee status. We check it at the start of every VA file so the fee isn’t charged by mistake.

Example: A $450,000 VA Purchase in the Treasure Valley

Here is how the costs on a typical zero-down VA purchase might be split when the seller agrees to help. The figures are a sample based on common Treasure Valley fees; your Loan Estimate will show your exact numbers.

Sample for illustration only. Actual fees vary by lender, title company, county, closing date and loan program.

Costs Idaho VA Buyers Often Overlook

• HOA transfer or setup fees: common in Ada and Canyon County subdivisions, often around $500. Ask the seller to cover them in the contract.
• Well and septic inspections: may be required on rural properties with private water or septic systems.
• Escrow reserves: a year of homeowners insurance plus several months of property taxes collected up front.
• Repairs called for by the VA appraisal: these must be completed before closing. If the appraisal comes in low, see our guide to requesting a reconsideration of value.
• Termite inspection: requirements change; see VA termite inspection rules in Idaho for the current status.

Start My VA Pre-ApprovalAsk Gerald a VA Question

Official Sources

• U.S. Department of Veterans Affairs: VA funding fee and loan closing costs
• 38 CFR 36.4313: Charges and fees
• VA Lenders Handbook, VA Pamphlet 26-7

Reviewed for accuracy against VA guidance on November 4, 2026. This article is general information, not a commitment to lend. Loan approval is subject to credit, income, property and underwriting review. 1st Choice Mortgage Company, LLC is not affiliated with or endorsed by the U.S. Department of Veterans Affairs. NMLS #380736.