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in Biggs, CA
Biggs homebuyers have two strong government-backed options that make homeownership more accessible. Both FHA and USDA loans offer lower barriers to entry than conventional mortgages, but they work differently.
FHA loans require as little as 3.5% down and accept lower credit scores. USDA loans offer zero down payment but have income limits and property location requirements that affect eligibility in Butte County.
Understanding which program aligns with your financial situation and property choice helps you move forward with confidence.
FHA loans from the Federal Housing Administration allow down payments as low as 3.5% with credit scores of 580 or higher. Borrowers with scores between 500-579 can qualify with 10% down.
These loans require both upfront and annual mortgage insurance premiums. The upfront premium is 1.75% of the loan amount, while annual premiums typically range from 0.45% to 1.05% depending on loan size and down payment.
FHA loans work for any eligible property type in Biggs, including single-family homes, condos, and multi-unit properties up to four units. There are no income limits or geographic restrictions within the city.
USDA loans require zero down payment for eligible rural and suburban properties. Biggs qualifies as a USDA-eligible area, making this program accessible to local homebuyers who meet the requirements.
The program has household income limits based on area median income. Most Butte County households must earn below 115% of the area median income to qualify, with exact limits varying by household size.
USDA loans charge a 1% upfront guarantee fee and an annual fee of 0.35% of the loan balance. These costs are typically lower than FHA mortgage insurance over the life of the loan.
The most obvious difference is the down payment: FHA requires 3.5% minimum while USDA offers zero down. For a property in Biggs, that could mean saving thousands of dollars upfront with the USDA option.
FHA has no income restrictions, making it available to all qualified borrowers regardless of earnings. USDA caps household income at roughly 115% of area median, which excludes higher earners even if they can afford the payments.
Both programs accept credit scores around 640 for most lenders, though FHA technically allows scores as low as 500 with larger down payments. USDA typically requires stronger credit profiles despite the zero-down benefit.
Annual costs differ significantly. USDA's 0.35% annual fee runs lower than most FHA mortgage insurance premiums, which range from 0.45% to 1.05%. This difference adds up over years of homeownership.
USDA loans make the most sense if you meet the income limits and want to preserve your savings. The zero-down feature and lower annual fees provide substantial long-term value for eligible Biggs buyers.
FHA becomes the better choice when your income exceeds USDA limits or you need more property flexibility. It also works if you're purchasing a multi-unit property or a home that doesn't meet USDA property standards.
Start by checking USDA income limits for your household size. If you qualify and your desired property is in an approved area, USDA typically offers better overall costs. If you're over the limit or need more flexibility, FHA provides a solid alternative path to homeownership.
FHA works for most property types anywhere in Biggs. USDA requires the property to be in a USDA-designated eligible area and meet specific property standards. Most of Biggs qualifies, but you should verify the specific address.
USDA typically offers lower monthly costs due to zero down payment and lower annual fees (0.35% vs 0.45-1.05% for FHA). Rates vary by borrower profile and market conditions, but the fee structure generally favors USDA.
FHA has no income limits and becomes your government-backed option. You can still get in with just 3.5% down and competitive rates despite not qualifying for USDA's zero-down program.
Yes, both programs charge insurance or guarantee fees. FHA charges 1.75% upfront plus 0.45-1.05% annually. USDA charges 1% upfront plus 0.35% annually. Neither insurance is removable without refinancing.
FHA typically processes slightly faster because it doesn't require USDA rural development approval. However, both programs can close in 30-45 days with proper preparation and documentation.