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in Hawthorne, CA
Both FHA and VA loans make homeownership easier in Hawthorne, but they serve different buyers. FHA accepts anyone with steady income and decent credit. VA requires military service but offers better terms.
Hawthorne sits near LAX and aerospace employers, attracting both first-time buyers and veterans. Your loan choice depends on whether you qualify for VA benefits. If you do, VA almost always beats FHA.
FHA loans need just 3.5% down with a 580 credit score. You pay mortgage insurance forever unless you refinance later. Loan limits in Los Angeles County go up to $644,000 for single-family homes.
These loans work for W-2 earners, self-employed borrowers, and anyone building credit. Your debt-to-income can stretch to 50% with strong compensating factors. Sellers cover closing costs more often than with conventional loans.
VA loans require zero down payment and charge no monthly mortgage insurance. You pay a one-time funding fee that varies by service type and down payment. Rates run lower than FHA because the government guarantee is stronger.
The VA allows up to 60% debt-to-income with residual income guidelines. Sellers can pay all your closing costs. You need a Certificate of Eligibility showing active duty, veteran status, or qualifying spouse benefits.
Down payment separates these loans first. FHA needs 3.5% minimum while VA accepts zero. On a $600,000 Hawthorne home, that's $21,000 versus nothing upfront.
Mortgage insurance costs diverge sharply. FHA charges 1.75% upfront plus 0.55% to 0.85% annually for the loan's life. VA charges a one-time funding fee of 2.15% to 3.3% with no monthly cost. Over 30 years, FHA insurance costs roughly $100,000 more on that same $600,000 purchase.
Credit flexibility favors FHA slightly. VA lenders prefer 620+ scores while FHA approves 580 reliably. But VA compensates with higher debt ratios and residual income analysis that helps borrowers with strong cash flow.
If you qualify for VA benefits, use them. Zero down and no monthly insurance beat FHA every time. The only exception is credit under 600 with recent derogatory marks—FHA might approve faster.
Non-veterans without large down payments should use FHA. It costs more than VA but far less than conventional loans requiring 10% to 20% down. Hawthorne's proximity to aerospace and aviation employers means many buyers qualify for VA through military service or defense contracting roles.
Yes, if you completed six years of service. You need a Certificate of Eligibility from the VA showing your qualifying service period.
No. FHA mortgage insurance stays for the loan's full term unless you refinance to conventional or VA later.
FHA typically closes 3 to 5 days faster. VA appraisals require extra inspections that extend timelines slightly.
Both allow up to four units if you occupy one. VA still requires zero down. FHA needs 3.5% on all unit types.
Sellers prefer VA when appraisals come in at value. VA's property condition requirements can scare some sellers, but strong offers overcome this.