Veteran Home Loans VS Conventional Loans VS FHA Loans
| Loan Type | VA Loan | Conventional Loan | FHA Loan |
| Minimum Down Payment | 0% | 3% | 3.5% |
| Mortgage Insurance | NO | YES | YES |
| Funding Fee | Yes | No | No |
| Interest Rates | Typically a bit lower then conventional | Standard Rates | Typically lower than conventional |
| Typically Minimum Fico | 580 | 620 | 580 |
| DTI Restrictions | Typically Higher Rations Allowed For Some Lenders | Industry Standard | Typically Higher Rations Allowed For Some Lenders |
| Difficulty To Qualify | Easier On Lower Credit Individuals & First Time Buyers | Industry Standard | Easier On Lower Credit Individuals & First Time Buyers |
The Main Difference In These Different Loan Types Are Down Payment Amounts, Mortgage Insurance, Qualification Processes, And Interest Rates.
Veteran Home Loans
0% Down
Veteran Loans are one of the best 0% down home loans available on the market today.
No Mortgage Insurance
VA Home Loans are backed by the Federal US Government so they they do not require a
monthly Mortgage Insurance Payment. Instead VA Mortgage can have a one time
funding fee which is far less than other MI options typically, Va Funding Fees are also typically
waived with any service related disability with a service related disability of deemed 10% or more
disabled.
Easier To Qualify Many times mortgage lenders and brokers can help clients with credit score down around a 580 FICO for Veteran Home Loans. Because the US Government backs the loan they can be easy to qualify for as well. Lots of traditional banks and financial institutions could be in the range of 620-660 even as a minimum FICO score.
Competitive Interest Rates
The VA backing the VA loans makes these loans favorable to banks, so many times VA loans
rates will typically be less expensive then Conventional Loans.
Conventional Loans
Mortgage Insurance Required
PMI or Private Mortgage Insurance is required on all loans unless you put the minimum 20%
down. With a conventional loan if you are putting anything less down than 20% down you will be forced to have mortgage insurance on the loan.
Up to 3%- 20% Down
Conventional mortgage loans generally require down payments that can reach up to 20% to secure a home loan if you want to avoid mortgage insurance.
Industry Standard Qualifications
Conventional Loans have stricter qualification processes and require borrowers to a be a bit better qualified to get a favorable rates and terms . Minimum credit scores are typical around 620.
Higher Rates Than VA Loans
Without government backing, banks are taking on more risk which, in turn, can result in a less-competitive interest rate on your home loan.
FHA Home Loans
3.5% Down
Veteran Loans are one of the best 0% down home loans available on the market today.
Mandatory Mortgage Insurance For Life Of The Loan
All FHA Mortgage loans now require mortgage insurance regardless of the amount of the down payment on the house. FHA loans typically have an Upfront Mortgage Insurance as well as a monthly payment that is on the loan for the life of the loan.
Easier To Qualify Many times lenders and brokers can help clients with credit score down around a 580 FICO for FHA. Lots of traditional banks and financial institutions could be in the range of 620-660 even as a minimum FICO score. These loans are better for first time home buyers, and individuals with less than perfect credit.
Competitive Interest Rates
The FHA interest rates are typically better the conventional loans at most banks, you must check with your local loan originators to see what the rate difference will be between the FHA and Conventional.
Note we are not guaranteeing any information about Rates, Downpayment, Qualifications, Fees, Or a commitment to lend to get real answers book a consultation with a licensed VA home loan expert now.
