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in Mendota, CA
Mendota buyers often qualify for both FHA and USDA loans. Both offer lower barriers than conventional mortgages, but they work differently.
FHA requires 3.5% down and accepts credit scores around 580. USDA requires zero down but limits income and property location.
Most Mendota properties qualify for USDA due to rural designation. The choice comes down to your income, savings, and which fees you prefer.
FHA loans let you buy with just 3.5% down if your credit score hits 580. Below that, you need 10% down.
You pay upfront mortgage insurance at closing (1.75% of the loan) and monthly premiums for the life of the loan. This adds cost but gets you approved with less-than-perfect credit.
FHA works anywhere, including Mendota. There are no income limits, so higher earners can still use it.
USDA loans require zero down payment. You finance 100% of the purchase price.
You must meet income limits based on household size. For Fresno County, that's typically 115% of median income for the area.
The property must be in a USDA-eligible zone. Most of Mendota qualifies as rural under USDA guidelines.
USDA charges a 1% upfront guarantee fee and 0.35% annual fee. Both are lower than FHA mortgage insurance costs.
Down payment is the biggest split. FHA needs 3.5%, USDA needs nothing.
USDA restricts who can qualify based on income. FHA doesn't care how much you earn.
USDA limits where you can buy. FHA works on any property that meets basic standards.
USDA costs less in monthly fees. The annual guarantee fee runs 0.35% versus 0.55%-0.85% for FHA mortgage insurance.
Pick USDA if you qualify by income and want to skip the down payment. Most Mendota homes are eligible.
Pick FHA if your income exceeds USDA limits or you're buying in an ineligible area. You'll need 3.5% saved but face no income restrictions.
Run the numbers on both. USDA saves you money upfront and monthly, but only if you clear the income hurdle.
Yes, most of Mendota qualifies as rural under USDA guidelines. The property must meet USDA's eligibility map requirements.
Limits vary by household size. A family of four typically caps around $103,500 annual income, but verify current limits before applying.
USDA typically costs less monthly due to lower guarantee fees (0.35% vs 0.55%-0.85% for FHA). The difference adds up over time.
Yes. FHA calls it mortgage insurance premium (MIP). USDA calls it a guarantee fee. Both protect the lender if you default.
FHA requires MIP for the loan's life on 3.5% down deals. USDA lets you drop the fee after refinancing to conventional with 20% equity.