VA Home Loans vs. Conventional Loans: Which Is Better For Your Emerald Coast Move?

Military families moving to Florida’s Emerald Coast often face a big decision: VA home loan or conventional mortgage? Here’s a quick, no-nonsense breakdown to help you pick the best fit.

Loan Eligibility
VA: Must be eligible military (active/veteran) with a Certificate of Eligibility (COE).
Conventional: Anyone with qualifying credit/history.

Down Payment
VA: $0 down possible.
Conventional: Usually at least 3%. 20% down removes PMI.

Mortgage Insurance
VA: No private mortgage insurance (PMI).
Conventional: PMI required if down payment is under 20%.

Interest Rates
VA: Typically 0.25%-0.5% lower than conventional.
Conventional: Depends on credit and down payment.

Credit Score
VA: No federal minimum, but most lenders require 620+.
Conventional: 620+ is typical for approval (higher is better).

Property Types
VA: Must be your primary home (1-4 units—one must be owner-occupied).
Conventional: Can be primary, secondary, or investment properties.

Loan Limits
VA: No cap with full entitlement.
Conventional: Local loan limits apply (example: $806,500 in Okaloosa County for 2024).

Closing Costs
VA: Limits on certain fees; sellers can help cover them.
Conventional: No restrictions on fees or who pays.

Refinancing
VA: IRRRL makes rate reductions simple, no full documentation in many cases.
Conventional: Standard refi with full appraisal and paperwork.

Comparison Example ($400,000 home):

• VA: $0 down, funding fee can be financed, no PMI = lower monthly
• Conventional (5% down): $20,000 down, add $200/month for PMI until 20% equity

When a VA Loan Makes Sense

• No or low down payment
• Must be a primary home
• Minimize monthly costs (no PMI)
• Seller can help cover fees

When Conventional is Better

• Buying a second home or investment
• You have 20%+ down
• Want to skip the VA funding fee
• Property doesn’t meet VA requirements

Need help deciding, or ready to see what’s possible?
Gimmie a call at 405-919-9030