If you’re exploring home financing in the U.S. and considering a VA home loan, one of the most common questions is:
“Does a VA loan have PMI?”
Short answer: No — VA loans do not have PMI.
But the reason why (and what replaces it) matters a lot for your long-term affordability. This guide explains everything clearly, without jargon, so you can decide if a VA loan is the right fit for you.
What Is PMI in a Mortgage?
PMI (Private Mortgage Insurance) is an extra monthly cost typically required on conventional loans when the down payment is less than 20%.
PMI:
- Protects the lender, not the borrower
- Is added to your monthly payment
- Can last years unless removed
Depending on the loan amount, PMI can significantly increase your housing cost over time.
Does a VA Loan Have PMI?
No. VA loans do NOT require PMI
Even if you:
VA loans are backed by the U.S. Department of Veterans Affairs, which allows lenders to offer favorable terms without private mortgage insurance.
This is one of the biggest advantages of a VA loan compared to conventional or FHA loans.
Why VA Loans Don’t Require PMI
VA loans use a different risk structure:
- The VA guarantees a portion of the loan
- This reduces lender risk
- PMI is not necessary
Instead of PMI, VA loans use a VA Funding Fee (explained below).
VA Funding Fee vs PMI (What’s the Difference?)
VA Funding Fee
- One-time fee, not monthly
- Helps keep the VA loan program available
- Amount depends on:
- First-time vs repeat use
- Down payment (if any)
- Loan type
- Can often be rolled into the loan
PMI
- Monthly cost
- Can last for many years
- Required on most low-down-payment conventional loans
- Paid continuously until removed
Many eligible borrowers find the one-time VA funding fee more affordable than years of PMI, depending on their situation.
This is for informational purposes only and not a commitment to lend. Terms depend on credit, underwriting, and investor guidelines.
Are There VA Loan PMI Exceptions?
There is no PMI on any VA loan, but some borrowers may be exempt from the VA funding fee, including:
- Veterans receiving VA disability compensation
- Certain surviving spouses
Eligibility depends on VA guidelines and documentation.
VA Loan vs Conventional vs FHA (PMI Comparison)
Loan Type | PMI Required? |
| VA Loan | No |
| Conventional (<20% down) | Yes |
| FHA Loan | Yes (Mortgage Insurance Premium) |
This is why VA loans are often considered one of the most affordable loan options for eligible borrowers.
Why Choose Loan Factory
When you use Loan Factory, you’re not just getting access to VA loans — you’re getting transparent options and expert guidance backed by industry-leading technology.
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Why homebuyers choose Loan Factory:
- Best Price Guarantee — If we can’t beat a competitor’s official offer, we’ll pay you $1,000 (Terms & Conditions apply.)
- No application or junk fees
- Compare 240+ wholesale lenders side by side
- Local loan advisors who understand VA guidelines
- AI-powered MOSO platform for faster approvals and real-time pricing
- Trusted guidance from Loan Factory, led by Thuan Nguyen (#1 Loan Officer in the U.S.)
Apply online: https://www.LoanFactory.com/apply
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Talk to a VA loan expert: (660) 333-3333
FAQ: VA Loan & PMI
