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in Azusa, CA
Both FHA and USDA loans offer paths to homeownership in Azusa with minimal cash down. FHA requires just 3.5% down and works anywhere in the city, while USDA offers zero down payment but only on eligible properties.
Most Azusa buyers default to FHA without checking if they qualify for USDA. That's a mistake — USDA can save you thousands on your down payment if you meet the income and property location requirements.
FHA loans accept credit scores as low as 580 for 3.5% down, or 500 with 10% down. You'll pay an upfront mortgage insurance premium of 1.75% plus annual premiums between 0.55% and 0.85% depending on your down payment and loan term.
These loans work on any property type in Azusa — single-family homes, condos, townhouses. The property just needs to meet FHA safety and livability standards, which most homes pass without issue.
USDA loans require zero down payment but restrict eligibility to properties outside dense urban areas. Parts of Azusa near the foothills may qualify, while areas closer to downtown Los Angeles typically don't.
You must meet income limits — generally 115% of area median income for most households. Credit requirements are flexible, often accepting scores around 640, though some lenders go lower with strong compensating factors.
Down payment is the obvious split — FHA needs 3.5%, USDA needs nothing. But USDA's 1% upfront guarantee fee beats FHA's 1.75%, and the annual fee runs about 0.35% versus FHA's 0.55% to 0.85%.
FHA works anywhere in Azusa with no income caps. USDA only covers eligible zones and won't approve you if your household income exceeds local limits, even with perfect credit and stable employment.
Run USDA eligibility first if you're buying near Azusa's northern boundary or in less developed areas. If the property qualifies and your income fits, zero down beats 3.5% down every time.
Go FHA when you're buying in central Azusa, eyeing a condo, or your income exceeds USDA caps. It's the more reliable option since you won't lose a property in contract because it falls outside eligible zones.
No. USDA restricts financing to eligible rural and suburban zones. Properties in denser parts of Azusa near downtown LA typically don't qualify.
USDA costs less. The annual fee runs about 0.35% versus FHA's 0.55% to 0.85%, and the upfront fee is 1% instead of 1.75%.
Yes. Both FHA and USDA accept gift funds from family members for down payment and closing costs with proper documentation.
FHA accepts 580 for minimum down. USDA typically wants 640+, though some lenders approve lower scores with strong income and assets.
USDA allows dropping MI after sufficient equity and time. FHA loans closed after 2013 require MI for the entire loan term.