Choosing between a VA loan and a conventional loan will depend on what makes the most sense for you financially. You’ll have to consider your borrower qualifications and down payment savings, and compare quotes to see your best rate offers.
Of course, you’ll only have that choice if you qualify for both a VA loan and conventional loan. VA loans are backed by the U.S. Department of Veterans Affairs and are only for veterans, current military members and some surviving spouses. Conventional loans, which are not backed by the federal government, are for anyone who can meet a lender's financial requirements.
Here’s what to consider when deciding between a VA mortgage and a conventional loan.
VA loans vs. conventional loans
Factors to consider | VA loans | Conventional loans |
|---|---|---|
Lenders | ||
Interest rates | ||
Property type | Primary home only | Primary or second home, investment properties |
Minimum down payment | Zero, most instances | Usually at least 3%. Some lenders offer special zero-down loans. |
Mortgage insurance | No mortgage insurance. One-time VA funding fee of 1.25% to 3.3% of loan amount for purchase mortgages. | Private mortgage insurance usually required if down payment is less than 20%. |
Loan limits | No loan limit with full entitlement. VA guaranty limits apply with partial entitlement. | $832,750 conforming limit for one-unit properties in most of the U.S. in 2026; up to $1,249,125 in high-cost areas. Loans above these limits require a jumbo loan. |
Minimum credit score | No minimum set by VA, but a 580-620 FICO score is a common lender requirement. | A 620 FICO score is typical. |
Maximum debt-to-income ratio | Lenders will give more scrutiny if DTI is over 41%. | Ideally under 36%, but higher ratios can be accepted. |
Estimate the costs of a VA loan
Using a VA loan calculator can help you compare the costs of a VA loan versus a conventional mortgage.
Estimate the costs of a conventional loan
Similarly, you can use a conventional loan calculator to help you compare the costs against a VA loan.
The final decision
A VA loan may be your best bet if you don't have a big down payment or have a higher DTI. You'll pay the one-time VA funding fee, but won't have the annual cost of private mortgage insurance.
A conventional loan may cost less than a VA loan if you can put down 20% and skip mortgage insurance. A conventional loan is also the way to go if you want to buy a second home or investment property.
The only way to make an informed choice is to compare mortgage rates and fees for both types of loans, given your financial details. Visit with a loan officer or mortgage broker who handles both VA and conventional loans to crunch the numbers and discuss options.
NerdWallet writer Isabella Angelos contributed to this story.
