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in Lawndale, CA
Both FHA and USDA loans offer low-barrier entry for Lawndale buyers who don't have massive down payments saved. The catch? USDA loans aren't available everywhere in LA County, and Lawndale's location matters here.
FHA loans work anywhere in the city with just 3.5% down if your credit score hits 580. USDA loans require zero down but come with strict income caps and property eligibility rules that knock out most of urban LA County.
FHA loans let you buy with 3.5% down if your credit score is 580 or higher. You'll pay mortgage insurance for the life of the loan unless you refinance, but approval odds beat conventional loans for borrowers with credit dings or thin files.
These loans cap at $766,550 in LA County for single-family homes. Debt-to-income ratios can stretch to 50% with strong compensating factors, which helps if you're carrying student loans or a car payment.
USDA loans require zero down payment but restrict eligibility to rural and some suburban areas. Most of Lawndale likely doesn't qualify because USDA defines it by population density, and urbanized parts of LA County get excluded.
If your property does qualify, you'll face income limits based on household size. A family of four can't exceed roughly 115% of the area median income. You'll also pay a 1% upfront guarantee fee and annual fees similar to FHA mortgage insurance.
The down payment gap is the obvious split: FHA needs 3.5%, USDA needs nothing. But USDA's location restrictions are the deal-killer for most Lawndale buyers because the city sits in a heavily developed corridor that USDA typically classifies as ineligible.
FHA has no income caps while USDA does. FHA works on any property type that meets safety standards. USDA limits you to single-family homes in approved rural zones, which means most of Lawndale won't qualify at all.
Check USDA's eligibility map first because if your target property isn't in an approved zone, this comparison is over. Most of Lawndale won't qualify due to population density, so FHA becomes your default government-backed option.
If you somehow find a USDA-eligible property and your income fits under the cap, zero down beats 3.5% down every time. But that's a narrow path. FHA gives you flexibility to buy anywhere in the city with minimal cash and accepts most property types that pass inspection.
Most of Lawndale doesn't qualify because USDA restricts loans to rural and low-density suburban areas. Check USDA's eligibility map for specific addresses before assuming you can use this loan.
USDA saves you the down payment but charges similar annual fees to FHA. Payments depend on your loan amount and rate, which vary by borrower profile and market conditions.
Yes, if the condo is on FHA's approved list. USDA only works on single-family homes in eligible rural zones, so condos are out.
Yes. FHA charges an upfront premium plus annual premiums for the loan's life. USDA charges a 1% upfront guarantee fee and annual fees similar to FHA.
FHA accepts credit scores as low as 580 and has no income caps. USDA needs better credit and caps your household income, making FHA the easier path for most borrowers.