Unpopular opinion: VA home loans aren't always the best deal for vets

I spent 7 years pushing every vet I knew toward a VA loan because that's what the ads say. Then I sat down with a lender in San Diego who showed me the funding fee actually costs more than conventional PMI on a 15-year term if you're not disabled. I was recommending something that was costing people 6 grand extra over the life of the loan. Who else has run the numbers and found a better route?

3 comments

3 Comments

grays131mo ago

See the funding fee does get waived for disabled vets like you mentioned, but the other hidden cost is the VA appraisal process can be a headache. I've had deals fall through because the appraiser flagged something minor that a conventional lender wouldn't care about. Also, if you're buying in a competitive market, sellers sometimes shy away from VA offers because they think the inspection will be too strict. So the funding fee is one thing, but the hassle factor adds up too.

spencer7821mo ago

I had a buddy buy in Portland using conventional with 5% down and his monthly payment was like 40 bucks lower than my VA loan on a similar house. The key is running both amortization schedules side by side instead of just trusting the "zero down" hype. For vets with good credit and 10% to put down, conventional often beats VA by a solid margin once the funding fee gets added to your loan balance.

milam481mo ago

Those ads are just marketing" - same goes for everything else we're told is a no-brainer...