Same home. Three different loans. Wildly different monthly payments, insurance costs, and approval odds. Enter your numbers — see which one wins for your situation.
Which Loan Is Right for You?
FHA — Best for:
Credit score 580-639
Less than 10% down payment
Higher DTI (up to 57%)
First-time homebuyers
SSDI or non-standard income
⚠️ MIP for life if <10% down
Conventional — Best for:
Credit score 680+
20% down (eliminates PMI)
Long-term cost savings
Investment properties
Jumbo loans (>$832K)
✅ PMI removable at 20% equity
VA — Best for:
Veterans & active duty
0% down payment
No PMI ever
VA disability income
Lowest monthly payment
✅ Best deal if you qualify
Frequently Asked Questions
Can I switch from FHA to conventional later?
Yes — this is called an FHA-to-conventional refinance. Once you have 20% equity and your credit score improves, refinancing to conventional removes the lifetime MIP. Many FHA borrowers plan this from day one: start with FHA, refinance in 5-7 years when equity and credit improve. The math often works out better than waiting to save 20% down.
What is the FHA MIP and how much does it cost?
FHA Mortgage Insurance Premium (MIP) has two components: upfront MIP (1.75% of loan amount, typically rolled into the loan) and annual MIP (0.55% for most loans with <10% down). On a $380K loan, that's $6,650 upfront + $174/month annual. If you put less than 10% down, MIP stays for the life of the loan — this is the biggest FHA disadvantage.
Does the VA funding fee cancel out VA loan savings?
Rarely. The VA funding fee (2.15% for first use, 0% down) is a one-time cost. Compare this to FHA MIP (1.75% upfront + 0.55%/year for life) or conventional PMI (0.5-1.5%/year until 20% equity). Over 30 years, VA almost always wins on total cost — especially for borrowers who would otherwise pay MIP. VA disability recipients pay 0% funding fee.
What credit score do I need for each loan?
Agency minimums: FHA 580 (3.5% down) or 500-579 (10% down), Conventional 620, VA 580 (no set minimum but most lenders require 580+). Most lenders add overlays above these minimums — conservative lenders often require 640-660 for FHA and 640+ for conventional. Check the FRC Overlay Reference Guide for typical ranges.
Not Sure Which Fits You?
Ask Zai your situation — SSDI, 1099, physician, first-time buyer.
Rates shown are estimates based on May 2026 market conditions. Actual rates vary by lender, credit score, and market. Not financial advice. Consult a licensed MLO.
FinanceRateCalc is a mortgage decision intelligence system that analyzes lender overlays and agency guidelines to explain loan denials and predict approval paths. FRC is not a lender, broker, or financial advisor. All analysis is educational. | About · Contact · Privacy