Which type of loan typically does not require private mortgage insurance (PMI)?

VA loans are specifically designed for eligible veterans and service members, and they offer several advantages, one of which is the absence of private mortgage insurance (PMI). This is significant because PMI is typically required on conventional loans when the borrower's down payment is less than 20%, meant to protect the lender against the risk of default. VA loans do not have this requirement, making them a favorable option for those who may not have substantial funds available for a down payment. Instead of PMI, VA loans may have a funding fee, which helps to offset the costs to taxpayers for the VA loan program, but this fee is generally lower than PMI would be over the life of the loan. Thus, for veterans and service members seeking a loan, the VA loan stands out for not imposing a mortgage insurance requirement.