Question 1

Does Clearlake qualify for USDA loans?

Accepted Answer

Much of Clearlake and Lake County falls within USDA-eligible rural boundaries. Check the USDA eligibility map using your specific property address to confirm.

Question 2

What credit score do I need for each loan?

Accepted Answer

FHA requires a 580 minimum for 3.5% down. Most USDA lenders want a 640 or higher, though some go lower with manual underwriting.

Question 3

Is USDA really zero down payment?

Accepted Answer

Yes. USDA requires no down payment for eligible borrowers. You still pay closing costs, though some can be rolled into the loan or covered by seller credits.

Question 4

Which loan has lower mortgage insurance?

Accepted Answer

USDA's annual fee runs 0.35%. FHA's annual MIP is typically 0.55%. USDA is cheaper month to month if you qualify.

Question 5

Can I use either loan to buy a fixer-upper in Clearlake?

Accepted Answer

USDA and FHA both require the home to meet minimum property standards. Serious repairs can disqualify a property from both programs.

Question 6

Do FHA loans have income limits in Lake County?

Accepted Answer

No. FHA has no income ceiling. Any borrower who meets credit and debt-to-income requirements can apply regardless of how much they earn.

FHA vs USDA Loans in Clearlake, CA