If you’re eligible for a VA loan but considering conventional or FHA, or maybe your loan officer told you not to use your VA loan, stop. Before you make a move that could cost or save you tens of thousands of dollars, you need to know this. In this video, I’m comparing VA, FHA, and conventional loans side by side so you can see what’s really best for your situation. And if you’re a veteran, active duty, or part of a military family, hit like, subscribe, and turn on your notifications. You deserve advice that’s built for you.

Hi, I’m Alex Ramirez and I help military veterans and military families like yours make smarter financial decisions and fully unlock your VA loan benefits.

Okay, let’s get into this. Let’s start with the biggest difference - the down payment.
VA loan: 0% down - zero, nada, nothing.
FHA: 3% minimum down payment.
Conventional: usually 5% to 20% down or more.

So for a $350,000 home:

• VA: $0 down.

• FHA: $12,250 down (3.5%).

• Conventional: $17,500 down (5%).

That alone is a game changer.

Mortgage insurance:

• VA: No PMI ever.

• FHA: Requires MIP - mortgage insurance premium - both upfront and monthly for the life of the loan. The upfront premium is 1.75% of the loan amount, which is financed, and the monthly MIP is 0.55% of the loan amount.

• Conventional: Requires PMI if you put down less than 20%, but it can be canceled once you reach a certain equity percentage.

Interest rates:

• VA loans typically have the lowest interest rates thanks to the VA backing.

• FHA is competitive but usually a bit higher than VA.

• Conventional depends heavily on your credit score - higher rates for lower credit, and larger down payments can earn lower rates. Even half a percent difference can equal tens of thousands of dollars over the life of the loan.

Credit score requirements:

• VA: No official minimum, but most lenders want 580 - 620+.

• FHA: Minimum 580 with 3.5% down, or 500 with 10% down.

• Conventional: Minimum 620, but higher scores mean better rates.

Upfront fees:

• VA: One-time funding fee that can be waived for disabled veterans and is usually financed into the loan.

• FHA: Upfront and monthly mortgage insurance that adds up quickly.

• Conventional: No upfront fee, but PMI applies if less than 20% down.

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Appraisal and property standards:

• VA: Strict - the property must meet minimum standards, but that ensures the home is safe and sound.

• FHA: Similar to VA, requiring livable and safe conditions.

• Conventional: More flexible, great for fixer-uppers.

Real cost breakdown - 5 years on a $350,000 home:

• VA: $0 down, 2.15% funding fee ($7,525 if rolled in), no PMI, and typically the lowest rate.

• FHA: $12,250 down + $6,125 upfront MIP + $240/month mortgage insurance = over $27,000 total.

• Conventional: $17,500 down + $150/month PMI = over $26,000 total out of pocket.

Who should use what:

• VA loan: Best overall value for eligible veterans and military families - it's designed to save you money.

• FHA loan: Great for low-credit buyers who don't qualify for VA, or even buyers with good credit who want low down payments.

• Conventional loan: Ideal for buyers with strong credit and larger down payments, or for properties that don't qualify for VA or FHA.

If you want to see this side-by-side comparison, download my VA vs. FHA vs. Conventional Loan Cheat Sheet - link in the description below.

Remember, you've earned the VA benefit. Use it wisely. There's a reason most veterans choose the VA loan when they learn the facts - it's built to save you money, help you build wealth, and set you up for long-term success.