Question 1

Can I switch from FHA to conventional later?

Accepted Answer

Yes, once you reach 20% equity and 620+ credit. Most Kerman buyers refinance within 3-5 years to eliminate FHA insurance.

Question 2

Which loan has lower closing costs?

Accepted Answer

Conventional usually costs less upfront. FHA adds a 1.75% funding fee, though you can roll it into the loan amount.

Question 3

Does FHA accept lower credit than 580?

Accepted Answer

Down to 500 credit with 10% down. Below that, you need manual underwriting and strong compensating factors to qualify.

Question 4

How much does FHA mortgage insurance cost monthly?

Accepted Answer

Between 0.55% and 0.85% annually based on loan amount and down payment. That's $160-$250 monthly on a $350,000 loan.

Question 5

Can conventional loans go below 5% down?

Accepted Answer

Yes, down to 3% for first-time buyers. You'll pay PMI until 20% equity, but it cancels automatically unlike FHA.

Conventional vs FHA Loans in Kerman: Which Fits Your Budget?