January 22, 2026
10 minutes
When you’re looking to buy a home, choosing the right mortgage can feel overwhelming - especially with so many opinions about VA loans vs. conventional financing.
At reAlpha Mortgage (NMLS ID: 1743790), we work with veterans every day. who are trying to make the most informed, financially smart decisions for their future.
This guide breaks down the key differences between VA loans and conventional loans - with facts, not hype - so you can choose what’s best for your unique situation.
Quick Overview: VA Loan vs. Conventional Loan
| Feature | VA Loan | Conventional Loan |
|---|---|---|
| Down Payment | 0% (for eligible borrowers) | 3–20% typically required |
Credit Score Requirements | Flexible (often starting around 580) | Typically 620 or higher |
| Private Mortgage Insurance | Not required | Required if <20% down payment |
Funding Fee | One-time fee (may be waived) | Not applicable |
Loan Use Limitations | Must be for a primary residence | Primary, secondary, or investment use |
| Government Backing | Backed by the U.S. Department of Veterans Affairs (VA) | Not government-backed |
Important Note: The VA does not lend money or endorse specific lenders. VA loans are provided by private lenders and backed by the VA to protect the lender in case of default.
Pro Tip: The VA loan benefit can be used more than once. It’s a reusable financial advantage many overlook.
Get Pre-Qualified and Save Up to 1.5% at Closing with reAlpha
Save up to 1.5% at closing when you combine real estate and mortgage services with reAlpha.
Why Many Veterans Choose VA Loans?
- No Down Payment: VA loans allow eligible veterans, service members, and certain surviving spouses to purchase a home with no down payment, which can significantly lower the upfront costs of homeownership.
- No Monthly PMI: While conventional loans typically require private mortgage insurance (PMI) for down payments under 20%, VA loans do not require PMI, helping reduce your monthly payment.
- Potential Funding Fee Waiver: VA loans include a one-time funding fee that helps support the program, but veterans with a qualifying service-connected disability may be exempt. Check with your lender or VA loan expert for eligibility.
- Flexible Credit Requirements: Many VA lenders accept credit scores starting around 580, while conventional loans usually require at least 620 or higher.
- Reusable Benefit: Contrary to common myths, the VA loan benefit can be used more than once, even if you've purchased a home before.
Debunking Common VA Loan Myths
Myth 1: VA loans are full of hidden fees
Reality: While there is a funding fee, VA loans eliminate other common costs like PMI and down payments. The funding fee can also be reduced or waived in many cases.
Myth 2: You can only use a VA loan once
Reality: VA loans are reusable, as long as you meet entitlement eligibility and occupancy requirements.
Myth 3: Conventional loans are always better for "serious buyers"
Reality: VA loans are backed by the federal government and offer powerful protections and savings designed specifically for qualified veteran borrowers.
Choosing the Right Loan for Your Situation
First-Time Homebuyers
- $0 down payment
- Easier credit qualification
- No PMI
Veterans with Lower Credit
- More flexible underwriting options
- Potential for lower rates than conventional
Veterans Interested in Real Estate Long-Term
- Use VA benefits again with remaining or restored entitlement
- Refinance later using VA’s IRRRL (Interest Rate Reduction Refinance Loan) program
Veterans Wanting to Save on Fees
- No monthly mortgage insurance
- Funding fee exemptions may apply
- Lenders like reAlpha Mortgage can help you explore veteran-friendly buying strategies - including ways to unlock a substantial buyer-agent commission rebate through reAlpha.
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.
Long-Term Financial Advantages of VA Loans
- Lower Upfront Costs = Faster path to homeownership
- No PMI = More buying power each month
- Favorable Debt-to-Income Ratios = Easier approval
- Refinancing Options = Flexibility for the future
Interested in scaling your real estate goals over time? Talk to a VA loan expert about how your benefits can support a multi-property strategy when properly structured.
Should You Use a Mortgage Broker?
Working with a broker - especially one with VA loan expertise - can help you:
- Understand complex VA eligibility rules
- Maximize potential waivers and exceptions
- Streamline the paperwork process
- Navigate dual entitlement or second-tier use cases
reAlpha Mortgage specializes in helping veterans access the full value of their hard-earned benefits - while saving thousands with smart, structured rebates.
How Does VA Loan Funding Fee Compare to PMI?
| Scenario | VA Loan Funding Fee | Conventional PMI |
|---|---|---|
One-time Fee (3.3% max) | $6,600 on $200,000 | N/A |
Monthly PMI (0.5–1% avg) | $0 | $83–166/month |
| Waivable for Disabled Veterans | Yes | No |
VA wins long-term-especially for those exempt from the funding fee.
Final Thoughts: Which Loan Wins?
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
Explore your savings and start your home journey now at reAlpha Mortgage
FAQs
Is a VA loan better than conventional?
Yes, especially for eligible veterans. $0 down, no PMI, and waived fees can outperform conventional in both affordability and accessibility.
Can I reuse my VA loan benefit?
Yes. You can restore and reuse it as long as entitlement rules are met.
Do VA loans close slower?
Not with the right broker. Closings often match or beat conventional timelines.
Can I use a VA loan for rentals?
Yes, for multi-units where you occupy one. Learn more here.
Who pays the VA funding fee?
The borrower typically does - but many are exempt.
Ready to Explore Your Options?
Whether you’re buying your first home or refinancing with a VA loan, the team at reAlpha Mortgage. (NMLS ID: 1743790) is here to guide you every step of the way.
Need help checking your VA eligibility or funding fee status? Contact us for a no-obligation consultation. Interested in commission-free home-buying tools? Ask about how reAlpha supports veteran-friendly real estate transactions.
You served. You earned this. Let’s make it work for you.
reAlpha Mortgage | NMLS ID: 1743790
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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.