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in Hanford, CA
Hanford buyers often face this choice: conventional financing with standard terms or VA benefits with zero down. Both loans get deals done in Kings County, but they serve different borrowers.
Your military service status usually decides this question before you compare rates. If you're VA-eligible, that 0% down payment option changes the math entirely for most buyers in Hanford's price range.
Conventional loans give you access to every property type in Hanford without government program restrictions. You'll need 620+ credit and typically 5% down for owner-occupied homes, though 3% down programs exist for first-timers.
These loans work well when you have savings for a down payment and want to avoid funding fees. PMI applies under 20% down, but you can drop it once you hit that equity threshold through payments or appreciation.
VA loans let eligible veterans and active military buy Hanford homes with zero down payment. You'll pay a one-time funding fee instead of monthly PMI, and that fee gets rolled into your loan amount.
Sellers in Kings County know VA loans close reliably despite the VA appraisal requirements. The program caps what lenders can charge in fees, which often saves borrowers money compared to conventional financing.
Down payment separates these options most clearly. VA requires nothing upfront while conventional asks for 3-20%. That difference matters in Hanford where your down payment money might stretch further than in coastal California markets.
The funding fee versus PMI calculation isn't simple math. VA's 2.3% funding fee (for first-time use with zero down) gets financed, while conventional PMI runs $50-200 monthly depending on your down payment size. Over five years, conventional PMI often costs less if you put 10%+ down.
Use VA if you're eligible and have limited savings for down payment. The zero-down benefit outweighs the funding fee for most service members, especially on first purchases in Hanford's market.
Choose conventional when you're not VA-eligible or when you have 15%+ saved for down payment. Larger down payments reduce PMI costs and sometimes unlock better rates than VA offers. Also go conventional for investment properties or if the home fails VA appraisal standards.
VA loans require owner-occupancy and the property must meet VA minimum property standards. Investment properties and some fixer-uppers won't qualify.
Both close in similar timeframes, typically 30-40 days. VA appraisals can add 3-5 days but rarely delay closing significantly.
Depends on your down payment. With zero down, VA saves money over conventional despite the funding fee. With 20% down, conventional wins.
Veterans with service-connected disabilities get the funding fee waived. All other eligible borrowers pay it, though rates vary by down payment size.
Conventional typically requires 620 minimum. VA has no official minimum, but most lenders want 580-620 for approval in practice.