Benefits of a VA Loan vs. Conventional Loan
VA Home Loan
Conventional
Down Payment
No Down Payment Required
Down Payment required
Financed Amount
You can finance up to 103.15% of the sale price which can allow closing fees and costs to be packaged into the loan
10-20% down requirement
Private Mortgage Insurance (PMI)
None
Yes if you put less than 20% down
Funding Fee*
Yes in certain circumstances
No
Prepayment Penalties
No Prepayment Penalty
In many occasions yes
VA Assistance during financial hardship
VA provides financial counseling for loan holders during hardship
No, not by the VA
Energy Efficient Improvements
Yes up $6,000 for approved improvements
No
Investment property
No; property must be owner-occupied
Yes
* A funding fee that is up to 2.4% for 1st time entitlement users and up to 3.3% for 2nd time entitlement users is required by law. The fee is waived if you have a service connected disability or you are a surviving spouse of a veteran died while in service or from a service connected disability.
For more information about the VA Funding Fee click here [link to: funding fee section]
