February 3, 2026
7 minutes
You’ve packed your household, scoped out neighborhoods near your new duty station, and finally found the one. But then, out of nowhere, a lender drops a term you weren’t expecting: PMI - Private Mortgage Insurance. Suddenly, your "no-down-payment" loan feels like it might be hiding something.
Let’s get right to it: Do VA loans require PMI?
Nope. Not even close. And that’s a major reason why VA loans are one of the most powerful financial benefits available to service members and veterans.
Key Takeaways:
- VA loans do not require private mortgage insurance (PMI), unlike most other loan types.
- Eliminating PMI can save veterans and active-duty buyers thousands over time.
- The VA funding fee replaces PMI - but may be waived in many cases.
- Understanding this benefit gives military families a huge financial edge.
In this guide, we’ll break it all down, answer every question you might have, and show you how to skip PMI and agent fees entirely-if you know where to look.
PMI Costs in 2025: The Hidden Monthly Drain
Here’s the deal:
- PMI can cost $30–$70 per $100K borrowed (Freddie Mac).
- On a $300,000 home, that's up to $2,500 per year-for insurance that protects the lender, not you.
- You typically pay PMI if you put down less than 20% on a conventional loan.
But with a VA loan? That entire line item vanishes.
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Save up to 1.5% at closing when you combine real estate and mortgage services with reAlpha.
Why?
Because the VA guarantees a portion of your loan. That guarantee acts like an insurance policy for the lender, so you don’t have to foot the bill for PMI.
The 5 Most Common VA + PMI Questions (Answered Fast)
1. Do VA loans require mortgage insurance?
No. VA loans are PMI-free by design. This benefit is exclusive to eligible military borrowers.
2. Is there a catch - like something that replaces PMI?
There’s a VA funding fee, but it's a one-time cost (and often waived for disabled vets). It's not monthly and not based on credit.
3. How much money could I save without PMI?
Thousands - literally. Over 5 years, skipping PMI could save $12,000+ depending on loan size.
4. Why do conventional and FHA loans charge PMI or MIP?
Because there’s no VA guarantee. Those lenders charge extra to protect themselves.
5. Who qualifies for this PMI-free benefit?
Most veterans, active-duty service members, National Guard, and Reservists. See full eligibility on VA.gov.
What If You Could Buy Commission-Free Too?
Imagine this:
- No PMI
- No agent commissions
- No stress
That’s not just smart - it’s next-level homebuying. And it’s exactly what reAlpha Offers a homebuying platform where you can receive a substantial portion of your buyer agent’s commission back, helping you maximize equity from day one.
Start your no-commission home search today on reAlpha.
Comparison Table: VA vs. FHA vs. Conventional
| Feature | VA Loan | FHA Loan | Conventional Loan |
|---|---|---|---|
| PMI Required | ❌ No | ✅ Yes (MIP) | ✅ Yes (<20% down) |
| Down Payment | 0% | 3.5% | 3–20% |
| Credit Score Flexibility | ✅ High | Moderate | Strict |
| Commission-Free Buying | ✅ (via reAlpha) | ❌ | ❌ |
Picture Life Without PMI
Think about it: No $150 monthly PMI. No 3% commission to an agent. Just your dream home, a smooth VA loan process, and thousands saved upfront and over time.
That’s more cash for your family, travel, or your next PCS.
Veterans Can Save Up to 1.5% at Closing with reAlpha
Save up to 1.5% on your purchase price by using reAlpha Realty and Mortgage together
FAQs
Do VA loans have PMI in 2025?
No. VA loans do not and have never required PMI.
Is there a VA funding fee instead of PMI?
Yes. It’s a one-time fee, usually rolled into the loan, and can be waived.
Can you avoid PMI with other loans?
Only by putting 20% down. VA loans avoid PMI entirely - regardless of down payment.
What’s the difference between PMI and MIP?
PMI is for conventional loans. MIP is required on FHA loans. Both add monthly costs - VA loans require neither.
A Smarter Way to Buy a Home - and Save at Closing
Buying a home is a big decision - and having the right information puts you ahead. But the real advantage comes from pairing smart research with a smarter way to buy.
When you use a reAlpha real estate company, you can be eligible to receive up to 1% of the home purchase price back as a credit at closing. Add reAlpha Mortgage, and that rebate can increase to up to 1.5% back, helping offset closing costs and keep more money in your pocket when it matters most.
The rebate is simple, transparent, and applied directly at closing - no complicated hoops, no delayed payouts. Just real savings tied to using a fully integrated homebuying experience.
See how much you could save:
- Check your eligibility
- Explore homes that fit your budget today.
- Your next move could come with thousands back at closing.
Estimate your savings → Rebate Calculator
Compliance Disclosures
- reAlpha Mortgage NMLS ID: #1743790
- All loan programs are subject to credit, income, and eligibility verification. Not all applicants will qualify.
- VA funding fee may apply -exemptions available for qualified veterans.
- reAlpha Is a homebuying platform that offers significant buyer agent commission rebates when you bundle services with reAlpha Mortgage and reAlpha Title.
This blog is for educational purposes and does not constitute financial or mortgage advice. Please consult a licensed mortgage professional for personalized guidance.
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Article by
Rocky Billore is a mortgage industry leader and Chief Sales Officer with over two decades of experience across residential and commercial lending. Since entering the industry in 2004, he has been directly involved in funding more than $1.4 billion in loans. A recognized expert in VA and government lending, Rocky combines deep program knowledge with a data driven, relationship-first leadership style. His work focuses on building scalable sales organizations, developing high performing teams, and aligning technology with real world lending outcomes to improve the homeownership experience.