FHA, VA, and Conventional Loans Compared

By David Parks · eXp Realty · The Apollo Group · 2 min read

The Short Answer

Conventional loans are not government-backed and often suit buyers with stronger credit. FHA loans allow lower down payments and more flexible credit, while VA loans offer no down payment for eligible veterans and service members.

FHA, VA, and Conventional Loans Compared
Stock photo: Pexels

Conventional loans

Typically require a credit score in the mid-600s or higher and can be done with as little as 3 to 5 percent down. Private mortgage insurance (PMI) applies below 20 percent down and can be removed later.

FHA loans

Backed by the Federal Housing Administration, with lower minimum credit scores and down payments as low as 3.5 percent. They carry mortgage insurance premiums, and have loan limits and property condition standards.

Quick Poll

Where are you in the buying process?

VA loans

For eligible veterans, service members, and some spouses. They often require no down payment and no monthly mortgage insurance, though a funding fee may apply.

Other options

USDA loans for eligible rural areas, jumbo loans for higher amounts, and state housing programs also exist.

Side by side
ConventionalFHAVA
Typical minimum down payment3 to 5%3.5%Often 0%
Credit scoreMid-600s or higherLower minimums allowedSet by lenders
Mortgage insurancePMI below 20% down (removable)Mortgage insurance premiumsNo monthly MI; funding fee may apply
Often best forBuyers with stronger creditLower down payments, flexible creditEligible veterans and service members

Typical figures. Lender requirements and program rules vary, so confirm with a lender.

How to choose

Compare total cost, not just rate. Ask a lender to show payments, mortgage insurance, and upfront costs side by side, and talk to your agent about which properties qualify.

Key Takeaways
  • Conventional loans: Typically require a credit score in the mid-600s or higher and can be done with as little as 3 to 5 percent down.
  • FHA loans: Backed by the Federal Housing Administration, with lower minimum credit scores and down payments as low as 3.5 percent.
  • VA loans: For eligible veterans, service members, and some spouses.
  • Other options: USDA loans for eligible rural areas, jumbo loans for higher amounts, and state housing programs also exist.

This article is general information, not legal, tax, financial or inspection advice. Every home and situation is different, so confirm details with a licensed inspector, lender, attorney or tax professional.

David Parks
About David Parks

David is a Greater Denver real estate advisor with eXp Realty and The Apollo Group (Colorado broker license FA100103211). He has closed more than $55 million in volume, earned eXp Icon status in 2025, and holds a 5.0 rating on Zillow from 27 verified reviews.

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