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in Corcoran, CA
Corcoran buyers with limited down payment funds typically face a choice between FHA and USDA loans. Both offer paths to homeownership without the standard 20% down, but they work very differently.
FHA loans require just 3.5% down and work anywhere in Corcoran. USDA loans offer zero down but only in eligible rural zones—most of Corcoran qualifies based on USDA maps for Kings County.
FHA loans let you buy with 3.5% down if your credit score hits 580. You pay an upfront mortgage insurance premium of 1.75% plus annual premiums of 0.55% to 0.85% for the loan's life on most purchases.
These loans cap your debt-to-income ratio at 50% with compensating factors, making them accessible for buyers carrying student loans or car payments. No income limits apply—you can earn any amount and still qualify.
USDA loans eliminate the down payment entirely for eligible rural properties in Corcoran. You pay a 1% upfront guarantee fee and 0.35% annual fee—significantly cheaper than FHA insurance.
The catch: your household income can't exceed 115% of the county median. USDA also requires 640 minimum credit score and limits you to primary residences only—no investment properties or second homes.
Down payment separates these loans first. USDA wins with zero down versus FHA's 3.5%. On a $250,000 Corcoran home, that's $8,750 you keep in your pocket with USDA.
Mortgage insurance costs tilt heavily toward USDA. Annual premiums run 0.35% versus FHA's 0.55% to 0.85%. Over 30 years, USDA saves you tens of thousands. But FHA accepts lower credit scores and doesn't cap your income.
Pick USDA if your household income stays under the county limit and you're buying in an eligible Corcoran zone. The zero down payment and lower insurance make it the superior deal when you qualify.
Choose FHA if you earn too much for USDA, need flexibility on property location, or your credit score sits between 580 and 639. FHA also closes faster since USDA's rural eligibility verification adds processing time.
Most of Corcoran meets USDA rural eligibility, but specific properties require verification. Check the USDA property eligibility map before making offers.
USDA typically wins with zero down payment and 0.35% annual insurance. FHA costs more due to higher insurance and the 3.5% down payment requirement.
Yes, FHA has no income limits. If you exceed USDA's county threshold, FHA becomes your low down payment option.
FHA allows 580 minimum credit scores. USDA requires 640 for streamlined approval through most lenders.
FHA requires lifetime insurance on most purchases. USDA drops insurance once your loan balance hits 80% of the home's original value.