The VA Home Loan is the very best mortgage available today to those who have earned the benefit.When comparing the pros and cons of both the VA Loan and Conventional Loan you will quickly find out that the VA Loan cannot be beat.
|VA Loan||Conventional Loan|
|0% Down Payment||5% Minimum Required Down Payment|
|No Private Mortgage Insurance||Mortgage Insurance Required with less than 20% Down Payment|
|Lower Interest Rates||Higher Rates for those with less than perfect credit and 20% Down Payment|
|Relaxed Qualifying Standards||Standard Qualifying|
|Higher Loan Limits (Based On County)||Maximum Loan Amount is $417,000|
VA Loans vs Conventional
The VA Advantage for Down Payment
VA Loans require 0% down payment in most cases.Conventional loans generally require at least a 5% down payment and sometimes up to 20% Down Payments
The VA Advantage for Private Mortgage Insurance
The Federal Government guarantees VA Home Loans thus protecting the lender in the case of default.Conventional Loans do not have the same Federal Government Guarantee and require private mortgage insurance for loans with less than a 20% down payment.
The VA Advantage for Interest Rates
VA Loan interest rates are typically lower than conventional rates because of their government guarantee.Since the government guarantees VA Home Loans, lenders have the ability to offer lower rates than are typically offered for conventional loans.For borrowers with less than perfect credit history VA Home Loan interest rates can be significantly lower than conventional loan rates.
The VA Advantage for Qualifying
Because of the government guarantee, VA Loans are much easier to qualify for by having less restrictive credit and income requirements.Conventional Loans have strict income, asset, and credit requirement that can keep many borrowers from qualifying.
The VA Advantage for Higher Loan Limits
You can obtain a VA Loan for up to $1,000,000!Conventional loans are limited to $417,000.For borrowers who are purchasing in a high cost area (see VA County Loan Limits), you can obtain a VA Home Loan for up to the County Loan Limit with 0% Down!