VA: GUARANTEED, eligible veterans, $0 down, funding fee, no monthly MI
Before you read
Test yourself first: 5 questions
Question 1 of 5
Private mortgage insurance (PMI) is typically required on a conventional loan when the down payment is:
Answer: C. Conventional lenders generally require PMI when the borrower puts down less than 20% (LTV above 80%).
Question 2 of 5
A conventional loan is one that is:
Answer: C. Conventional loans are not government-insured/guaranteed. FHA insures and VA guarantees their respective loan programs.
Question 3 of 5
A conventional loan is best described as a loan that is:
Answer: C. A conventional loan is any mortgage that is not insured by the FHA or guaranteed by the VA (or other government program); it relies on the borrower's creditworthiness and the property as security.
Question 4 of 5
Private mortgage insurance (PMI) on a conventional loan is generally required when the loan-to-value ratio exceeds:
Answer: D. Lenders typically require PMI on conventional loans when the LTV is above 80% (down payment less than 20%) to protect against default risk.
Question 5 of 5
The mortgage insurance charged on an FHA loan is called the:
Answer: B. FHA loans carry a mortgage insurance premium (MIP), which includes an upfront premium and an annual premium; PMI applies to conventional loans, not FHA loans.
Keep the streak going with more questions like these, each with a full rationale.
Must-know rules
- FHA: INSURED, low down (3.5%), MIP upfront + annual, owner-occupants
- VA: GUARANTEED, eligible veterans, $0 down, funding fee, no monthly MI
- USDA: rural areas, income limits, $0 down
- Conventional: not government-backed; <20% down usually needs PMI
- PMI cancels near 78-80% LTV; FHA MIP often lasts the life of the loan
FHA vs VA vs USDA vs Conventional: FAQs
Is FHA vs VA vs USDA vs Conventional on the real estate exam?
Yes. Financing & Lending is a scored domain on the real estate licensing exam, and this topic appears in the national portion.
Is this cheat sheet free?
Yes — every page on Cinna RE's resource library is free to read, print and share. The app adds practice questions, mock exams and a readiness score.
