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in Lakeport, CA
Both FHA and VA loans offer low-cost paths to homeownership in Lakeport, but they serve different buyers. FHA works for anyone who qualifies, while VA requires military service.
The biggest split comes down to down payment and mortgage insurance. VA loans eliminate both, which can save tens of thousands over the loan term.
FHA loans let you buy with just 3.5% down if your credit score hits 580. Below that, you need 10% down but can still get approved with a 500 score.
You'll pay upfront mortgage insurance of 1.75% plus annual premiums of 0.55% to 0.85%. That's the tradeoff for flexible approval standards and low down payments.
VA loans require zero down payment and charge no monthly mortgage insurance. You pay a one-time funding fee of 2.3% for first-time use, which can be rolled into the loan.
Most lenders want a 620 credit score, though VA itself sets no minimum. You need a Certificate of Eligibility proving military service, which takes about 10 days to obtain.
VA beats FHA on cost if you qualify. No down payment means you keep cash for repairs or emergencies. No mortgage insurance saves $150 to $250 monthly on a typical Lakeport home.
FHA accepts lower credit scores and doesn't require military service. That makes it the fallback when VA isn't an option or when your credit sits below 620.
Use VA if you're eligible, period. The savings on down payment and insurance dwarf any benefit FHA offers. Even with the 2.3% funding fee, you come out ahead within three years.
Pick FHA only if you don't qualify for VA or your credit falls below 620. It's still a solid option for first-time buyers who need flexible approval standards.
No, you choose one loan type per purchase. If you're VA-eligible, use that first since the savings beat FHA by a wide margin.
Both take 30 to 45 days typically. VA adds time for the Certificate of Eligibility if you haven't obtained it yet.
Yes, but the home must meet safety standards. Both programs offer rehab versions that fund repairs, though those add complexity.
Disabled veterans skip the fee entirely. Others can pay it upfront at closing instead of financing it into the loan.
You'd refinance into a VA loan later. Most borrowers wait until rates drop or they hit 20% equity to make the move worthwhile.