FHA vs. VA Loans

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FHA vs. VA vs. Conventional Loans

FHA Loans

VA Loans

Conventional Loans

· A minimum investment of 3.5% if the seller pays closing costs.

· No down payment.

· Typically requires a minimum down payment of 5 percent.

· The seller can pay points and closing costs not to exceed 6 percent of the loan amount.

· The maximum loan amount is $240,000.

· Mortgage insurance is usually charged for loans with less than a 20 percent down payment.

· The loan is assumable by a qualified buyer.

· Loan is assumable by a qualified buyer. If the buyer is not a veteran, you may lose your eligibility.

· Offer a wide variety of financing options.

· A Mortgage Insurance Premium (MIP) is charged regardless of the amount of down payment. First year premium is 1.75% and can be financed.

· A funding fee is charged based on the number of times you have used you eligibility. Currently, if you have never used you eligibility, the fee is 2 percent of the loan amount. This fee can be financed.

· Underwriting guidelines tend to be stricter.

· The funding fee may be reduced with a down payment of at least 5 percent.

· The amount of down payment determines what contribution the seller can make.

· Available to all veterans and active duty military. Also available to reservists who have served at least six years.

· Buyer can apply for a loan in any amount.

· Seller can pay normal and customary points, closing costs and prepaids.

Please use the resources available on this website to help you make an informed decision and if you have any questions along the way make sure to use the “Ask An Expert” feature.

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