Do VA Loans Require PMI? Here's What You Really Need to Know

You’ve packed your household, scoped out neighborhoods near your new duty station, and finally found the one. But then, out of nowhere, a lender drops a term you weren’t expecting: PMI—Private Mortgage Insurance. Suddenly, your "no-down-payment" loan feels like it might be hiding something.

Let’s get right to it: Do VA loans require PMI?

Nope. Not even close. And that’s a major reason why VA loans are one of the most powerful financial benefits available to service members and veterans.

Key Takeaways:

• VA loans do not require private mortgage insurance (PMI), unlike most other loan types.
• Eliminating PMI can save veterans and active-duty buyers thousands over time.
• The VA funding fee replaces PMI—but may be waived in many cases.
• Understanding this benefit gives military families a huge financial edge.
  

In this guide, we’ll break it all down, answer every question you might have, and show you how to skip PMI and agent fees entirely—if you know where to look.

PMI Costs in 2025: The Hidden Monthly Drain

Here’s the deal:

• PMI can cost $30–$70 per $100K borrowed (Freddie Mac).
• On a $300,000 home, that's up to $2,500 per year—for insurance that protects the lender, not you.
• You typically pay PMI if you put down less than 20% on a conventional loan.
  

But with a VA loan? That entire line item vanishes.

Why?

Because the VA guarantees a portion of your loan. That guarantee acts like an insurance policy for the lender, so you don’t have to foot the bill for PMI.

The 5 Most Common VA + PMI Questions (Answered Fast)

1. Do VA loans require mortgage insurance?

No. VA loans are PMI-free by design. This benefit is exclusive to eligible military borrowers.

2. Is there a catch—like something that replaces PMI?

There’s a VA funding fee, but it's a one-time cost (and often waived for disabled vets). It's not monthly and not based on credit.

3. How much money could I save without PMI?

Thousands—literally. Over 5 years, skipping PMI could save $12,000+ depending on loan size.

4. Why do conventional and FHA loans charge PMI or MIP?

Because there’s no VA guarantee. Those lenders charge extra to protect themselves.

5. Who qualifies for this PMI-free benefit?

Most veterans, active-duty service members, National Guard, and Reservists. See full eligibility on VA.gov.

What If You Could Buy Commission-Free Too?

Imagine this:

• No PMI
• No agent commissions
• No stress
  

That’s not just smart—it’s next-level homebuying. And it’s exactly what reAlpha offers: a commission-free homebuying platform designed to maximize your equity from day one.

Start your no-commission home search today on reAlpha.

Comparison Table: VA vs. FHA vs. Conventional

Picture Life Without PMI

Think about it: No $150 monthly PMI. No 3% commission to an agent. Just your dream home, a smooth VA loan process, and thousands saved upfront and over time.

That’s more cash for your family, travel, or your next PCS.

FAQs

Do VA loans have PMI in 2025?

No. VA loans do not and have never required PMI.

Is there a VA funding fee instead of PMI?

Yes. It’s a one-time fee, usually rolled into the loan, and can be waived.

Can you avoid PMI with other loans?

Only by putting 20% down. VA loans avoid PMI entirely—regardless of down payment.

What’s the difference between PMI and MIP?

PMI is for conventional loans. MIP is required on FHA loans. Both add monthly costs—VA loans require neither.

Take Back Control of Your Homebuying Journey

You served—now make your benefits work for you.

Get expert help from Be My Neighbour for a VA loan that skips PMI and closes fast.

Explore commission-free homes with reAlpha, where your next move costs less and gives more.

Compliance Disclosures

• Be My Neighbour NMLS ID: #1743790
• All loan programs are subject to eligibility and approval. Not all applicants will qualify.
• VA funding fee may apply. Exemptions are available for eligible veterans.
• reAlpha is a separate platform that provides commission-free home shopping services. No compensation is received from Be My Neighbour or affiliated loan originators.

This blog is for educational purposes and does not constitute financial or mortgage advice. Please consult a licensed mortgage professional for personalized guidance.