Loading
in La Mirada, CA
La Mirada buyers face a clear choice: conventional or FHA financing. Most borrowers qualify for both, but the math works out differently based on your down payment and credit profile.
Conventional loans reward strong credit with lower costs. FHA loans get you in the door with less cash and looser approval standards.
Conventional loans come from private lenders without government backing. You need 620+ credit and 3% down minimum, though 20% down eliminates PMI entirely.
These loans shine for buyers with solid credit and decent savings. Loan limits go up to $806,500 in Los Angeles County, covering most La Mirada properties.
PMI drops off automatically at 78% loan-to-value. Monthly insurance costs less than FHA when your credit tops 700.
FHA loans carry government insurance, letting lenders approve deals they'd normally decline. You put down 3.5% with 580 credit or 10% with scores as low as 500.
The upfront insurance premium hits 1.75% of your loan amount at closing. Monthly insurance runs 0.55% to 0.85% annually for the loan's entire life on most deals.
Sellers can contribute up to 6% toward closing costs versus 3% on conventional. That flexibility helps cash-strapped buyers close deals.
Credit standards split these loans apart. Conventional demands 620 minimum and prices get worse below 680. FHA approves 580 scores routinely and doesn't punish lower credit as hard.
Mortgage insurance works completely differently. Conventional PMI costs 0.3% to 1.5% annually and drops off. FHA charges 1.75% upfront plus 0.55% to 0.85% monthly that never cancels.
Down payment math favors different scenarios. Both allow 3% down, but conventional requires 20% to skip insurance. FHA keeps insurance regardless of down payment size.
Choose FHA if your credit sits below 680 or you're scraping together the minimum down payment. The upfront premium stings, but approval odds beat conventional by a mile.
Go conventional when you have 700+ credit and can put down 10% or more. Your monthly payment runs lower and insurance eventually disappears.
Run both scenarios with actual rate quotes. The answer flips based on your specific credit score, down payment, and how long you plan to keep the loan.
Yes, refinance to conventional once you build 20% equity and your credit improves. This drops the monthly mortgage insurance permanently.
Conventional typically closes 2-3 days faster since FHA requires additional property inspections. Neither timeline creates major delays locally.
FHA requires HOA approval from their condo list. Conventional approves more condo projects without extra paperwork or waiting.
You'll see top pricing at 740+ credit. Every 20-point drop below that costs about 0.25% in rate.
No, both require owner occupancy. You need a conventional investment property loan for rentals in La Mirada.