VA and FHA Loans Explained: Eligibility, Requirements, and How They Compare

VA and FHA loans are the two government-backed programs most buyers in Maryland, Virginia, DC, and Pennsylvania ask about. They serve different borrowers and work differently, and understanding both makes it easier to see which one fits your situation.

VA Loans

VA loans are backed by the U.S. Department of Veterans Affairs and are available to eligible veterans, active-duty service members, certain members of the National Guard and Reserves, and some surviving spouses.

Key Features

• No down payment is required for most eligible borrowers within program limits.
• No monthly mortgage insurance. A one-time funding fee applies instead and can be financed into the loan. Some borrowers, including those with a service-connected disability rating, are exempt.
• Certificate of Eligibility: Confirms your entitlement; we can help you obtain it as part of your application.
• Occupancy: The home must be your primary residence.

FHA Loans

FHA loans are insured by the Federal Housing Administration and are open to any qualified borrower, not only first-time buyers. They are originated by FHA-approved mortgage companies.

Key Features

• Down payment as low as 3.5% with a credit score of 580 or higher; 10% down between 500 and 579.
• Mortgage insurance premium (MIP): An upfront premium plus an annual premium paid monthly, for most of the loan's life at lower down payments.
• Flexible credit guidelines relative to conventional programs.
• Occupancy: Primary residence only; one- to four-unit properties are eligible.

Side by Side

Feature	VA	FHA
Who qualifies	Eligible military borrowers	Any qualified borrower
Minimum down payment	None for most	3.5%
Monthly mortgage insurance	None	Yes (MIP)
Upfront fee	Funding fee; some exempt	Upfront MIP
Property use	Primary residence	Primary residence, 1-4 units

Loan Limits

FHA publishes loan limits that vary by county and are updated each year, and several counties in our service area are designated high-cost. VA borrowers with full entitlement have no program loan limit; those with entitlement already in use are subject to county limits. Ask your loan officer for the current figures in the county where you are buying.

Next Steps

If you may be eligible for a VA loan, or want to see how an FHA loan fits your budget, contact us or start your application. A licensed loan officer will review your eligibility and explain each program in detail.