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FHA Loan Mortgage Insurance: A Reader Question


A reader asks, “Veterans are not required to purchase mortgage insurance with a VA loan. Is there a way that a veteran can be exempt from the mortgage insurance premium? The mortgage insurance is very high.”

The short answer to this reader question is “no”. FHA loans are not designed the same way that VA home loans are–FHA loans require a Mortgage Insurance Premium (MIP), where VA home loans do not. Veterans should consider their options between VA home loans and FHA mortgages carefully. In some cases a veteran or currently serving military member could choose an FHA loan over a VA mortgage, for a variety of reasons.

But a borrower faced with these choices should make the most informed decision possible. FHA home loans do have certain similar features to VA mortgages including the ability to apply for a Streamline Refinance loan with no FHA-required credit check or appraisal. A lender is free in both cases (VA and FHA) to require one or both depending, but the FHA Streamline Refinance is similar in many other respects to the VA version.

FHA loans also feature a similar cash-out refinance option to VA loans and in both cases there is an appraisal required and a new credit application which must be submitted. In both cases these loans have an occupancy requirement, though VA loan rules may have additional considerations for veterans depending on the circumstances.

VA loans require no down payment in many cases, and while FHA insured mortgages do have a down payment requirement the amount is much lower than many conventional mortgages. VA and FHA loans both have their advantages and unique features–veterans should not be afraid to explore these options when it’s time to start planning for a new home.

Do you have questions about FHA home loans? Ask us in the comments section. You can apply or get pre-approved for an FHA mortgage loan at, which is a private company and not a government website.


Joe Wallace - Staff Writer

By Joe Wallace

October 31, 2013

Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for for (8) years and is currently the Associate Editor for

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About was launched in 2010 by seasoned mortgage professionals wanting to educate homebuyers about the guidelines for FHA insured mortgage loans. Popular FHA topics include credit requirements, FHA loan limits, mortgage insurance premiums, closing costs and many more. The authors have written thousands of blogs specific to FHA mortgages and the site has substantially increased readership over the years and has become known for its “FHA News and Views”.

5850 San Felipe Suite #500, Houston, TX 77057 281-398-6111. is privately funded and is not a government agency.

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