When it comes to buying a home in Texas, one of the most common questions we get is: should I use VA financing or go with a conventional loan? The truth is, both loan types have their strengths, and the right choice really depends on your financial goals, eligibility, and the property you’re looking to buy. Let’s break it down.
What Makes VA Financing So Good
If you qualify for a VA loan, it can be one of the best mortgage options available. Designed for veterans, active-duty service members, and some surviving spouses, VA loans offer some incredible perks:
- 100% financing with no down payment required
- No private mortgage insurance (PMI), even with 0% down
- Competitive interest rates
- No loan limits, meaning you can finance homes above traditional conforming limits (including into the jumbo range)
- Less impact from lower credit scores compared to conventional loans
That makes VA loans a powerful tool for eligible borrowers in Dallas and across Texas.
When Conventional Financing Might Be the Better Choice
Despite all those benefits, there are situations where a conventional loan might make more sense. If you’re a veteran or military buyer considering your options, here are a few reasons why you might choose conventional financing instead:
You’re Putting Down a Large Down Payment
VA loans are ideal for zero-down scenarios, but when you’re putting 20% down or more, conventional financing might come out ahead. Here’s why:
- VA loans include a funding fee, which ranges from about 2% to over 3% of the loan amount (unless you’re exempt due to a service-connected disability).
- With 20% down, conventional loans don’t require PMI either, which levels the playing field on that benefit.
- The absence of a VA funding fee could make the conventional loan cheaper overall when putting a large sum down.
You Want to Save Your VA Eligibility for a Future Purchase
In fast-growing areas like Dallas-Fort Worth, it’s common for military families to buy a home for just a few years before relocating. If that’s your plan:
- Using conventional financing now allows you to preserve your VA eligibility for your forever home later on.
- That might be especially important if you plan to buy a more expensive home in a higher-cost area like Austin, California, or Hawaii.
You’re Buying a Condo That’s Not VA Approved
Not all condos and townhomes qualify for VA financing. In cases where:
- The condo project isn’t VA approved
- The HOA bylaws cause the property to be classified differently
- You may have no choice but to go conventional.
You Want a Competitive Edge in a Multiple Offer Situation
This one is frustrating, but real: some listing agents or sellers shy away from VA financing.
Conventional offers can appear stronger to certain sellers, especially in competitive Dallas-area markets.
That perception (even if incorrect) can make a difference when multiple offers are on the table.
You’re Buying an Investment Property or Second Home
VA loans can only be used for primary residences. If you’re:
- Purchasing a second home in the Hill Country
- Looking to buy a rental property
You’ll need to use conventional or another type of financing. This isn’t about one being better—it’s just a rule of VA loans.
You Might Qualify for an Appraisal Waiver
If you’re putting down a sizable down payment and have strong credit, conventional financing might offer:
- An appraisal waiver, especially in high-data areas like Frisco, Plano, and other North Texas suburbs
- Faster closings with fewer VA-specific requirements
When VA Still Wins Big (Even in Dallas)
Even with all those scenarios where conventional might make more sense, VA financing still stands out in many cases:
- If you want to keep more cash in your pocket and avoid a down payment
- If your credit score isn’t stellar, but you want a great rate
- If you’re buying a higher-priced home and prefer 100% financing on a jumbo VA loan
- If you’re exempt from the VA funding fee due to a service-connected disability
In those cases, the numbers often favor VA by a wide margin.
What About VA Jumbos?
VA jumbo loans (which go above standard conforming limits) are especially compelling in Texas markets like Dallas, where home values have risen quickly:
- You can finance a home for $800,000, $900,000, or even $1 million with 0% down
- Try doing that with a conventional jumbo loan and you’re looking at a 20% down payment or more
As long as you’re not paying the funding fee (or even if you are and the rate is still better), VA jumbo financing is hard to beat.
How to Know What’s Best for You
At the end of the day, there’s no one-size-fits-all answer. If you’re eligible for VA financing in Texas, it’s worth comparing it against conventional financing side by side.
We always say: let the numbers speak for themselves. Here’s what we look at:
- Credit score and profile
- Down payment amount
- Long-term plans (is this a short-term home or forever home?)
- Funding fee eligibility
- Market competitiveness and listing dynamics
- Future plans for additional home purchases
It’s our job to help you figure out what truly makes the most financial sense—not just now, but years down the road.
Let’s Run the Numbers Together
Thinking about buying in Dallas, Fort Worth, Frisco, or anywhere else in Texas? Whether you’re an active-duty military member, a veteran, or someone who qualifies for a conventional loan, our team will help you understand every angle.
We’ll compare VA vs conventional options in real-time, walk you through the pros and cons, and help you feel 100% confident in your decision.
When you think mortgage, think Mark.
Mark Pfeiffer
Regional Sales Manager
Loan Officer, NMLS # 729612
(972) 829-8639
MortgageMark@MortgageMark.com
Mark Pfeiffer is a Mortgage Loan Originator with CMG Home Loans and a veteran of the mortgage industry since 2003. Mark is responsible for ensuring all loans originated by the Mortgage Mark Team offer competitive terms and close on-time.