Eligible veterans comparing VA to conventional financing are usually comparing a $0-down, no-PMI loan to a loan that requires cash down and monthly insurance. The math almost always favors VA — with a few real exceptions.
The two biggest structural differences
- Down payment: VA requires $0 down for eligible veterans with full entitlement. Conventional requires at minimum 3–5% down, and avoiding PMI altogether takes 20% down.
- Mortgage insurance: VA has no monthly mortgage insurance, ever — the tradeoff is a one-time funding fee (often financed into the loan, and waived entirely for veterans with a service-connected disability rating). Conventional charges monthly PMI until you reach 78–80% loan-to-value, then it's removed automatically or on request.
Rate and closing cost differences
VA interest rates are frequently priced slightly below comparable conventional rates because the VA guaranty reduces lender risk. VA also caps lender origination charges at 1% and prohibits a defined list of non-allowable fees the veteran cannot be charged. Sellers can contribute up to 4% in concessions on a VA loan, on top of paying normal closing costs.
When conventional can win
- The veteran has 20%+ saved and wants to avoid the funding fee entirely
- The property is a second home or pure investment property (VA requires owner-occupancy)
- The veteran already used significant entitlement on another property and doesn't want to tie up more
- The veteran wants to avoid the funding fee's effect on loan-to-value in a soft-appreciation market
Get your VA Pre-Approval Summary.
Complete the short form and we send back a full VA breakdown: your entitlement, the VA funding fee, and an estimated $0-down monthly payment — with no mortgage insurance, ever.
- Your entitlement and county loan limit (if applicable)
- $0 down payment — no mortgage insurance, ever
- One-time VA funding fee, financeable into the loan
- Estimated monthly payment with taxes and insurance
Summary emailed and shown on screen · Not an approval or commitment to lend
Illustration only, generated from the information you enter. Not a Loan Estimate, pre-qualification, commitment to lend, or approval. Subject to appraisal, credit and income review, VA guidelines, and final lender approval. Not affiliated with, endorsed by, or sponsored by the U.S. Department of Veterans Affairs. Equal Housing Opportunity.
- Purchase price
- $385,000
- Down payment
- $0
- Base loan amount
- $385,000
- Financed funding fee (2.15%)
- $8,278
- Est. monthly payment
- $2,690
Sample figures · Simply Approved Mortgages · NMLS #2620881 · Equal Housing Opportunity
The assumability edge
VA loans are assumable by a qualified buyer, VA approval required. In a rising-rate environment, an assumable 4–5% VA rate can be a meaningful selling point years down the road — something no conventional loan offers.
Run the numbers on your file
The right comparison depends on your disability rating (funding fee exemption), how much you have saved, and how long you'll keep the loan. Simply Approved Mortgages runs both a VA and a conventional quote side by side on request so you can see total cash to close and monthly payment for your actual scenario.
VA home purchase calculator: run your own numbers
Edit the fields to see your down payment, financed one-time VA funding fee, and full monthly payment. VA loans allow $0 down and carry no monthly mortgage insurance.
Estimates only. Nothing here is an application, pre-qualification, pre-approval, rate quote, rate lock or commitment to lend. You can keep using this tool without giving us anything.
Estimates only — not a loan offer, rate lock, or commitment to lend. Taxes, insurance, and rates vary by county and credit profile.