House passes bill hiking VA mortgage refi fees to fund expanded veterans’ benefits

The U.S. House of Representatives on Thursday passed a bill that increases benefits for veterans and their surviving families, offsetting the cost by raising fees on Department of Veterans Affairs (VA) refinance transactions.

The legislation — H.R. 6047, also known as the Sharri Briley and Eric Edmundson Veterans Benefits Expansion Act of 2025 — was introduced in November by Rep. Tom Barrett (R-Mich.) and co-sponsored by House Veterans’ Affairs Committee Chairman Mike Bost (R-Ill.)

The bill would increase benefits for severely disabled veterans requiring round-the-clock care, raise survivors’ VA benefits by 1.5% over two years, and expand VA home loan eligibility for National Guard and Reserve members. Specifically, it reduces the active-duty requirement for Guard and Reserve members from 90 days to 14 days, with a 1% fee. Lawmakers estimate the changes will impact more than 500,000 people.

To offset the costs of the expanded benefits, the proposal raises the VA refinance fee from 0.5% to 1.42%, increases the assumption fee from 0.5% to 1%, and extends current funding fee rates for non-disabled veterans while adding modest monthly costs for some borrowers.

Lawmakers noted that the VA refinance fee is optional, meaning it only applies to veterans who choose to lower their interest rates. Disabled veterans are exempt from the extra fees, and the changes will not affect their ability to use the program.

But Common Defense, a national organization for veterans and military families, condemned the bill’s passage. The group stated that the legislation nearly triples the Interest Rate Reduction Refinance Loan (IRRRL) program fee to 1.4% and costs the average veteran more than $8,000 over the life of the loan.

While the group supports expanding benefits for Gold Star families and severely disabled veterans, it argued that “Congress should not force one group of veterans to bear the cost of supporting another.”

“Changing the rules of the VA home loan program to make refinancing more expensive for financially strained veterans does real harm to military families,” Naveed Shah, political director of Common Defense, said in a statement.

The original plan would have raised VA home purchase loan fees to help fund the expanded benefits. But lawmakers revised the terms weeks after mortgage trade groups expressed concerns about the initial draft.

Ultimately, 20 veteran service organizations and stakeholders supported the bill, which saw massive backing from Republicans. More than 150 Democrats voted against it.