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Paradise is still rebuilding after the 2018 Camp Fire. That means more affordable prices than most of California — and FHA loans fit that picture well.
FHA's low down payment requirement matters here. Buyers entering a recovering market don't need to bring a huge cash stack to close.
580 (3.5% down)
Min Credit Score
3.5%
Min Down Payment
$541,287
Butte County FHA Limit
Required — upfront + annual
Mortgage Insurance
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Rates Vary By Profile
FHA Loans in Paradise
You need a 580 credit score to put 3.5% down. Drop below 580 and you'll need 10% down — but FHA still works.
FHA also allows higher debt-to-income ratios than conventional loans. That helps buyers with student loans or car payments still in the picture.
Local decision guide
Use this guide to connect fha loans eligibility, lender expectations, and local market factors before comparing payment options in Paradise.
Paradise is still rebuilding after the 2018 Camp Fire. That means more affordable prices than most of California — and FHA loans fit that picture well.
FHA's low down payment requirement matters here. Buyers entering a recovering market don't need to bring a huge cash stack to close.
You need a 580 credit score to put 3.5% down. Drop below 580 and you'll need 10% down — but FHA still works.
Most retail banks offer FHA, but their overlays — internal rules stricter than FHA minimums — can kill deals that should close.
Wholesale lenders we access often have fewer overlays. That means more approvals on properties or borrower profiles that retail banks turn away.
Paradise has a lot of new construction after the fire. FHA has specific appraisal standards — the property must meet HUD guidelines.
New builds usually clear those standards easily. Older or fire-damaged homes that weren't fully rebuilt may not — get that appraisal early.
USDA loans are also available in parts of Butte County — and USDA requires zero down. If you qualify by income and location, that beats FHA.
Conventional loans need stronger credit and more down. If your score is under 680, FHA will almost always get you a better rate.
Butte County's FHA loan limit is $541,287 as of April 2026. Most Paradise homes price well under that — limits aren't a constraint here.
Insurance is a real issue post-Camp Fire. FHA requires hazard insurance, and some carriers won't write policies in Paradise. Solve this before you're in contract.
Yes. New construction typically meets FHA appraisal standards without issues. Confirm the builder has a certificate of occupancy before closing.
3.5% with a 580+ credit score. On a $300,000 home, that's $10,500 down.
Yes. FHA requires active hazard insurance at closing. Getting coverage in a fire zone can be hard — start shopping early.
USDA wins if you qualify — zero down beats 3.5%. But USDA has income limits and property eligibility rules that not every buyer meets.
Yes. FHA charges an upfront premium of 1.75% and an annual premium built into your monthly payment. It doesn't go away unless you refinance.
Not in its damaged state. The home must be safe and livable at closing. FHA 203k rehab loans exist for properties needing repairs.