FHA vs Conventional vs VA Loan Comparison Calculator
Choosing the right mortgage is one of the most important financial decisions you will make. Our FHA vs conventional vs VA loan comparison calculator instantly compares the three major loan types across interest rates, down payment requirements, insurance costs, and eligibility. Find the loan that saves you the most money.
How the Calculator Works
1. Enter your home price — the purchase price of the property
2. Select your loan type — FHA, conventional, or VA
3. Enter your down payment amount — or use the slider for each loan type
4. Get the full comparison — monthly payment, total interest, insurance costs, and closing costs
Quick Comparison at a Glance
| Feature | FHA Loan | Conventional Loan | VA Loan |
|---|
| Minimum Down Payment | 3.5% | 3% (some programs) | 0% |
| Mortgage Insurance | Required (MIP) | Required (PMI) if <20% down | None |
| PMI/MIP Duration | Life of loan (unless 10% down) | Until 20% equity | N/A |
| Credit Score Minimum | 580 (3.5% down) | 620+ | No minimum |
| Loan Limit | $548,250 (standard) | $1,149,825 (2026) | No limit |
| Seller Contribution | Up to 6% | Up to 3% | Up to 4% |
| Assumable | Yes | Generally no | Yes |
| Refinance Options | FHA Streamline | Conventional, FHA IRRRL | VA IRRRL |
Cost Comparison by Loan Type ($400,000 home)
| Metric | FHA (3.5% down) | Conventional (10% down) | VA (0% down) |
|---|
| Down Payment | $14,000 | $40,000 | $0 |
| Loan Amount | $386,000 | $360,000 | $400,000 |
| Interest Rate (example) | 6.625% | 6.375% | 6.50% |
| Monthly P&I | $2,447 | $2,214 | $2,528 |
| Upfront MIP | $6,580 | N/A | N/A |
| Annual MIP | $3,088/year | N/A | N/A |
| Monthly MIP | $257 | N/A | N/A |
| PMI (if applicable) | N/A (MIP covers it) | $150-$300/month | N/A |
| Total Monthly | ~$2,704 | ~$2,364 | ~$2,528 |
| Total Interest (30yr) | ~$495,000 | ~$437,000 | ~$510,000 |
| Total Insurance (30yr) | ~$113,000 | ~$0 (if 20% down) | $0 |
Down Payment Requirements Breakdown
| Loan Type | Minimum | Recommended | PMI/MIP Until |
|---|
| FHA | 3.5% | 10%+ to avoid life MIP | Life of loan (unless 10% down) |
| Conventional | 3% (some programs) | 20% to avoid PMI | Until 20% LTV reached |
| VA | 0% | N/A (no PMI) | N/A |
| USDA | 0% | N/A | USDA funding fee only |
Interest Rate Differences Explained
| Loan Type | Typical Rate | Why Rates Differ |
|---|
| FHA | 0.125-0.25% higher | Higher risk (low down payment, lower credit) |
| Conventional | Baseline | Lower risk, higher eligibility |
| VA | 0.125-0.25% lower | Government-backed, zero down payment |
PMI vs MIP: The Insurance Difference
| Aspect | PMI (Conventional) | MIP (FHA) |
|---|
| Required When | Down payment < 20% | Always for FHA |
| Monthly Cost | 0.5-1.5% of loan/year | 0.5-1.0% of loan/year |
| Duration | Until 20% LTV | Life of loan (unless 10% down) |
| Can cancel | Yes (at 20% equity) | Rarely (life MIP) |
| Tax deductible | Sometimes | Sometimes (consult tax advisor) |
| Upfront cost | None | 1.75% of loan amount |
Eligibility Requirements
| Requirement | FHA | Conventional | VA |
|---|
| Credit Score | 580+ (3.5% down) | 620+ | No minimum |
| Debt-to-Income | Max 43% (some allow 50%) | Max 45-50% | Max 41% |
| Employment | 2-year work history | 2-year consistent | Active duty or eligible veteran |
| Documentation | Standard | Full income verification | DD-214, certificate of eligibility |
| Property | Must meet FHA standards | Standard appraisal | Must meet VA MPRs |
| Occupancy | Primary residence only | Primary residence | Primary residence only |
Closing Cost Comparison
| Closing Cost | FHA | Conventional | VA |
|---|
| Origination fee | 0.5-1% | 0.5-1% | 0.5-1% |
| Appraisal | $500-$700 | $500-$700 | VA-paid in some cases |
| Title insurance | $1,000-$2,500 | $1,000-$2,500 | $1,000-$2,500 |
| Government fees | $175+ | Varies | $0-$300 |
| Seller credits | Up to 6% | Up to 3% | Up to 4% |
| **Total closing costs** | **$4,000-$10,000** | **$4,000-$10,000** | **$1,500-$5,000** |
FHA Loan Pros and Cons
| Pros | Cons |
|---|
| 3.5% minimum down payment | Life of loan mortgage insurance |
| Lower credit score requirement | Stricter property condition standards |
| Assumable by buyers | Upfront MIP adds to loan balance |
| Seller can pay up to 6% closing | Higher interest rates |
| Deeper debt-to-income ratios | Annual MIP cannot be removed without refinancing |
Conventional Loan Pros and Cons
| Pros | Cons |
|---|
| No monthly insurance if 20%+ down | Higher credit score requirement |
| Competitive interest rates | PMI if down payment < 20% |
| No upfront insurance | Stricter documentation requirements |
| Flexible loan terms (15, 20, 30yr) | PMI until 20% equity is reached |
| Portfolio loan options | Not assumable by most buyers |
VA Loan Pros and Cons
| Pros | Cons |
|---|
| 0% down payment | Limited to eligible veterans/spouses |
| No PMI or monthly insurance | Funding fee (1.25-3.3% of loan) |
| Often lower interest rates | Property must meet VA MPRs |
| Assumable by eligible buyers | Limited to primary residence |
| Flexible credit requirements | Closing costs must follow guidelines |
| VA Streamline refinance option | Funding fee varies by category |
When Each Loan Type Makes the Most Sense
| Scenario | Best Loan Type | Why |
|---|
| First-time buyer, low credit | FHA | Lower credit threshold, 3.5% down |
| High credit, 20% down | Conventional | No PMI, best rates |
| Veteran, $0 down | VA | No PMI, no down payment |
| Planning to stay 7+ years | Conventional | PMI drops once 20% equity reached |
| Planning to sell in 3-5 years | FHA | Easier qualification, flexible DTI |
| Cash-out refinance | Conventional | Best cash-out terms |
Loan Comparison for Different Home Prices
| Home Price | FHA (3.5% down) | Conventional (10% down) | VA (0% down) |
|---|
| $250,000 | $8,750 down | $25,000 down | $0 down |
| $350,000 | $12,250 down | $35,000 down | $0 down |
| $450,000 | $15,750 down | $45,000 down | $0 down |
| $550,000 | $19,250 down | $55,000 down | $0 down |
| $650,000 | $22,750 down | $65,000 down | $0 down |
| $750,000 | $26,250 down | $75,000 down | $0 down |
FAQ
Which loan type is the cheapest overall?
Conventional loans with 20% down have the lowest total cost over time — no PMI, competitive rates, and no upfront insurance. FHA loans with low down payments cost more in insurance over the loan life. VA loans are cost-effective for eligible veterans.
Can I switch from FHA to conventional later?
Yes. You can refinance an FHA loan to a conventional loan once you have built 20% equity (through payments and home appreciation). This eliminates PMI and typically lowers your interest rate.
Does the VA funding fee count as PMI?
No. The VA funding fee is a one-time fee paid at closing (or financed into the loan). It is not recurring mortgage insurance like PMI or FHA MIP.
What happens if I refinance from FHA to conventional?
You can eliminate FHA mortgage insurance (MIP) and potentially get a lower interest rate. However, you must meet conventional loan requirements, including credit score, income verification, and home appraisal.