Short answer: no. Veterans who receive VA compensation for a service-connected disability are exempt from the VA funding fee entirely — the one-time fee that first-time users with no down payment would otherwise pay (2.15% of the loan amount).
The exemption also applies to a few other groups:
- Active-duty service members who are Purple Heart recipients
- Surviving spouses receiving Dependency and Indemnity Compensation (DIC)
- Veterans who would be entitled to disability compensation but are receiving retirement or active-duty pay instead
Your exemption status is confirmed by the VA on your Certificate of Eligibility (COE). If your COE hasn't caught up with a recent disability rating, the exemption can often still be documented so you aren't charged the fee at closing — and if you already paid it, you may be eligible for a refund, as long as the effective date of your disability compensation is retroactive to before your loan closed.
Gene can pull your COE electronically and check your funding-fee status before you get to the closing table.