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in Fresno, CA
Both FHA and VA loans help Fresno buyers who can't put 20% down, but they serve different groups. One requires mortgage insurance forever if you put less than 10% down, while the other has zero down payment and no monthly MI.
The choice comes down to your military status and how much cash you have. Veterans who qualify for VA loans almost always come out ahead in the long run.
FHA loans let you buy with just 3.5% down if your credit score hits 580. You'll pay an upfront mortgage insurance premium of 1.75% plus monthly MI that ranges from 0.45% to 1.05% annually based on your down payment and loan amount.
These loans work well for first-time buyers in Fresno who don't have military service. Credit requirements are flexible, and most lenders accept scores as low as 580, though some of our wholesale partners go down to 500 with 10% down.
The catch is mortgage insurance. Put down less than 10% and you pay MI for the entire loan term. That monthly cost never drops off unless you refinance into a conventional loan later.
VA loans require zero down payment for eligible veterans and active-duty service members. You pay a one-time funding fee that ranges from 1.4% to 3.6% depending on down payment and whether it's your first VA loan, but no monthly mortgage insurance ever.
The funding fee gets waived entirely if you receive VA disability compensation. For Fresno veterans buying their first home with a VA loan and no down payment, expect a 2.3% funding fee that can be rolled into the loan amount.
Rates on VA loans typically run 0.25% to 0.5% lower than FHA because lenders see them as lower risk. Combine that with no monthly MI and you're looking at significant savings over a 30-year term.
Eligibility is the first split. FHA is open to anyone who meets credit and income requirements, while VA loans require military service or marriage to a qualifying veteran. Most active-duty members, veterans with honorable discharge, and some Reservists and National Guard members qualify.
Monthly costs tell the real story. An FHA loan at $400,000 with 3.5% down carries roughly $340 in monthly mortgage insurance. A VA loan at the same amount has zero monthly MI, saving $4,080 per year.
The upfront costs look similar when you compare FHA's 1.75% MI premium to VA's 2.3% funding fee for first-time users. But FHA adds that monthly MI on top, while VA doesn't. After year one, VA loans pull ahead on total cost.
If you qualify for a VA loan, use it. The zero down payment and no monthly MI make it the best deal for eligible borrowers in Fresno. Even if you can put money down, VA loans often beat FHA on total costs over five years or more.
FHA makes sense when you don't have military service and your credit sits between 580 and 640. It's your path to homeownership with a small down payment when conventional loans won't approve you.
Run the actual numbers on your scenario. We see Fresno buyers who qualify for both and choose VA loans 95% of the time once they compare monthly payments and long-term costs.
No, you pick one loan type per property. If you qualify for VA, you can't combine it with FHA benefits on the same purchase.
VA loans almost always cost less monthly because they have no mortgage insurance and lower rates. FHA adds $200-400 in MI per month on typical Fresno home prices.
Yes, but the complex must be FHA or VA approved respectively. We check approval status before you make an offer to avoid wasted time.
Yes, veterans with FHA loans can refinance to VA loans to drop mortgage insurance. This move saves hundreds monthly once you have VA eligibility.
Both close in similar timeframes of 30-45 days. VA loans once took longer but appraisal times have evened out in the Fresno market.