Final answer:
The number of discount points charged is NOT a factor when calculating the VA funding fee. The funding fee is based on the borrower's veteran status, type of loan, and whether the loan is being used for the first time or subsequent use, not on discount points.
Step-by-step explanation:
The factor that is NOT considered when calculating the VA funding fee is C. Number of discount points charged. The VA funding fee is a one-time payment that the Veteran, service member, or survivor pays on a VA-backed or VA direct home loan. This fee helps to lower the cost of the loans for U.S. taxpayers since the VA home loan program doesn't require down payments or monthly mortgage insurance.
The VA funding fee is calculated based on several factors:
- The borrower's military category (veteran status).
- Whether the borrower is using the VA loan benefit for the first time or for subsequent use.
- The type of loan - whether it's a purchase or a refinance.
- The loan-to-value ratio (LTV), which is not directly used but influences if down payments are made, which then affects the fee.
Discount points, which are a form of prepaid interest, do not have any impact on the VA funding fee and thus are not a factor in its calculation.