Which feature does a VA loan have that an FHA loan does not?

A VA loan offers a unique advantage with a Loan-to-Value Ratio (LTVR) of up to 100%, which allows eligible veterans and service members to finance their home purchase without requiring a down payment. This feature is particularly beneficial for those who may not have significant savings or the ability to make a sizable upfront investment in a home.

In contrast, FHA loans generally require a down payment, which often starts at 3.5% for borrowers with a credit score of 580 or higher. This difference in down payment requirements highlights one of the key distinctions between VA loans and FHA loans, making the full financing option of the VA loan more accessible to eligible individuals.

The other options, such as no prepayment penalties or the option of discount points, can apply to both VA and FHA loans, making them less distinguishing features. The right of reinstatement is not uniquely associated with VA loans either, as FHA loans can also have similar provisions. Thus, the unique feature of the VA loan allowing for 100% financing sets it apart from FHA loans.