FHA loans are a great program for many first-time buyers — but for eligible veterans, a VA loan almost always costs less. FHA requires a down payment and charges mortgage insurance every month, usually for the life of the loan. Here is the comparison, the few exceptions, and what to do if you already have an FHA loan.
If you have a Certificate of Eligibility, VA is likely the stronger option.
Read the video script
If you’re eligible for VA and someone offers you an FHA loan, ask why. I’m Shirley Mueller.
FHA: 3.5% down, 1.75% upfront mortgage insurance, and a monthly premium that usually lasts the life of the loan. VA: zero down, and no monthly mortgage insurance — ever.
Already in an FHA loan? A VA refinance can move you over and wipe out that mortgage insurance.
Send me your FHA statement and I’ll show you what switching saves.
Side by side
| VA | FHA | |
|---|---|---|
| Minimum down payment | $0 (full entitlement) | 3.5% |
| Upfront fee | Funding fee 2.15% first use at $0 down; $0 with VA disability comp | 1.75% upfront mortgage insurance premium |
| Monthly mortgage insurance | None | Yes — typically for the life of the loan with less than 10% down |
| Who can use it | Eligible veterans, service members, some surviving spouses | Anyone who qualifies |
When FHA might make sense
- You are not yet eligible for VA (for example, you haven’t met the minimum service requirement).
- Your entitlement is tied up in another VA loan and the remaining entitlement would require a large down payment in your county.
- You are buying with a non-veteran, non-spouse co-borrower and the VA joint-loan math doesn’t work.
Even then, compare carefully — conventional may beat FHA too.
Already have an FHA loan?
If you are eligible for VA, a VA cash-out refinance can replace your FHA loan — even with no cash out (a “Type I” refinance) — and eliminate FHA’s monthly mortgage insurance. For many veterans, that alone lowers the payment noticeably.
What veterans say about working with Shirley
4.9 95 Google reviews“Shirley and her team were an absolute pleasure to work with. They helped my wife and I obtain a VA Construction Loan which gave us the ability to build our dream home.”
April 2026 · Google review
“Great experience with them. Shirley and her team are awesome. They do everything to make sure it is a smooth process for a VA loan. I read a bunch of great reviews about them and went with them because of that. I highly recommend using Shirley at Cross Country Mortgage.”
April 2026 · Google review
“Ms. Shirley and her team are the BEST. Clear communication, specialized VA knowledge, responsiveness, and reduced stress. Thank you all for your help .”
April 2026 · Google review
Real Google reviews of VALoansTexas.com, shown word for word. Team members named in reviews were part of Shirley’s team at the time. Read more reviews →
VA vs. FHA Loan FAQ
Is VA or FHA better for veterans?
For eligible veterans, VA is almost always better: no down payment and no monthly mortgage insurance, versus 3.5% down and ongoing mortgage insurance with FHA.
Can I refinance my FHA loan into a VA loan?
Yes. A VA cash-out refinance can replace an FHA loan, with or without cash out, and remove FHA mortgage insurance.
Why would a veteran use FHA?
Usually only if they are not yet VA-eligible, their entitlement is heavily used, or a co-borrower situation doesn’t fit VA.
