Homebuyers who have served or are currently serving in the military can save thousands in housing payments annually by using a VA loan benefit, which offers rates lower than conventional mortgages and doesn’t require private mortgage insurance.
Despite that, not all eligible military members use the benefit. Fifty-five percent of veteran homebuyers used a VA loan to fund their purchase in 2025, while one-third used a conventional mortgage instead, according to the National Association of Realtors.
This could be a missed opportunity. A CNBC Select analysis found that a borrower taking out the averageVA loan amount in 2025, which was $390,101 —according to an analysis of VA data by Rocket Mortgage and Redfin — could have saved $2,601.84 annually in housing payments with a VA loan compared to a conventional mortgage.
To reach that conclusion, we compared monthly principal and interest payments on a 30-year fixed-rate VA loan and a conventional mortgage using the $390,101 loan amount.We used the average VA and conventional mortgage rates as of Nov. 4, per Optimal Blue.
In both scenarios, we determined the buyer had enough cash for a 10% down payment. For the conventional mortgage, we added annual private mortgage insurance equal to 0.5% of the loan balance, divided into monthly payments — because a conventional loan borrower who puts down less than 20% must purchase PMI.
In the VA loan equation, we did not include the VA funding fee in the comparison because it is typically a one-time fee. We then multiplied the monthly payment difference by 12 to estimate the annual savings.
Savings will vary based on loan size, interest rate and other factors. To get the lowest rate possible, strengthen your credit and save up for a large down payment.
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Best VA lenders
If you’re interested in a VA loan, CNBC Select has reviewed dozens of lenders who offer the product, including companies that dedicate their entire business to loans for veterans. Veterans United and Navy Federal Credit Union are two of our favorites.
In addition to its full suite of VA loans, Veterans United has a foundation that partners with local and national charities like Avalon Action Alliance, an organization dedicated to supporting veterans’ mental and physical health, and Blue Star Families, which connects military families with resources and community support.
Additionally, Veterans United has excellent customer service. It earns high ratings in J.D. Power surveys and from the Better Business Bureau.
Veterans United
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Types of loans
Conventional, FHA, VA, USDA, jumbo, refinancing, HELOC, home equity loan
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Terms
10-, 15-, 20-, 25- and 30-year fixed-rate
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Minimum credit score
620 for conventional, 500 for FHA
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Minimum down payment
0% for VA loan, 3% for conventional, 3.5% for FHA
If you want a full-service financial institution, NFCU may be a great fit. This not-for-profit credit union is open to service members, veterans and their families. If you join to take out a mortgage, you can do your checking, savings and borrowing all in one place. It also has some of the lowest VA loan rates on the market.
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Why trust CNBC Select?
At CNBC Select, our mission is to deliver high-quality service journalism and comprehensive consumer advice to our readers, enabling them to make informed financial decisions. Every mortgage article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of mortgage products.While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content independently of our commercial team and any outside third parties, and we pride ourselves on maintaining high journalistic standards and ethics.
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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
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