For many in the Brazos Valley, the choice between these two loan types comes down to one thing: Long-term affordability. While Conventional loans offer maximum flexibility for investors, the VA loan remains a “powerhouse” benefit for those who have served.
1. The Entry Point: Down Payments
- VA Loan: $0 Down. You can finance 100% of the home’s value. In 2026, with the average B-CS home price rising, keeping that cash in your pocket for furniture or renovations is a massive advantage.
- Conventional Loan: Typically requires 3% to 20% down. For a $400,000 home, that’s an upfront cost of $12,000 to $80,000.
2. The Monthly Savings: PMI vs. No PMI
This is the “hidden” cost that often surprises buyers.
- VA Loan: Zero Monthly PMI. Regardless of your down payment, you never pay Private Mortgage Insurance.
- Conventional Loan: If you put down less than 20%, you must pay monthly PMI. In 2026, this can add $150–$300 to your monthly mortgage payment depending on your credit score.
3. Interest Rate Comparison
Because the federal government backs VA loans, lenders often offer lower interest rates than Conventional products.
- Current Trend: In early 2026, VA rates are consistently averaging 0.25% to 0.50% lower than Conventional rates.
- The Math: On a $400,000 loan, a 0.5% lower rate can save you roughly $125 per month—or $45,000 over the life of the loan.
4. Fees: The Funding Fee vs. Upfront Costs
- VA Funding Fee: VA loans have a one-time “Funding Fee” (2.15% for first-time use) that can be rolled into the loan. Note: If you have a 10% or higher disability rating, this fee is waived entirely.
- Conventional Upfront Costs: While there is no funding fee, you may face higher “loan-level pricing adjustments” if your credit score isn’t in the 740+ range.
Comparison at a Glance (2026 Standards)
| Feature | VA Loan | Conventional Loan |
| Min. Down Payment | 0% | 3% |
| Monthly PMI | None | Required <20% Down |
| Credit Flexibility | High (580–620+) | Moderate (660–740+) |
| Occupancy | Primary Residence only | Primary, Second, or Investment |
| 2026 Loan Limit | No Limit (Full Entitlement) | $832,750 (Conforming) |
5. Appraisal Standards: Safety vs. Value
- VA Appraisals: Focus on “Minimum Property Requirements” (Safe, Sound, Sanitary). In B-CS, this means things like HVAC and roofing must be in good working order.
- Conventional Appraisals: Focus almost entirely on market value. If you’re buying a “fixer-upper” that needs significant work, a Conventional loan might be your only path.
6. The 2026 Texas “Super” Advantage
In Texas, veterans can stack their VA loan with Property Tax Exemptions. In 2026, the general homestead exemption increased to $140,000, and disabled veterans can receive even higher exemptions. This combination of a low-rate VA loan and reduced property taxes makes Texas one of the most affordable places in the country for veterans to buy.
The Verdict: Which is better?
- Choose VA if: You are an eligible veteran or service member. Between the $0 down payment, the lower interest rate, and the lack of monthly PMI, the VA loan is almost impossible to beat for a primary residence.
- Choose Conventional if: You are buying an investment property, a vacation home in the Hill Country, or if you have 20%+ to put down and want to avoid the VA funding fee.
Curious how much you’d save monthly by switching from a Conventional quote to a VA loan? I can run a side-by-side “Total Cost Analysis” for any home you’re considering in Bryan or College Station. Would you like to see the numbers?