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in Manhattan Beach, CA
Manhattan Beach homes command premium prices, making your financing choice critical. Conventional loans offer the flexibility most buyers need, while VA loans give eligible service members serious advantages in this competitive coastal market.
Both loan types work well here, but they play by different rules. Your military status, down payment capacity, and price point determine which option gets you better terms.
Conventional loans are the workhorse of Manhattan Beach real estate. You need at least 3% down, and rates improve significantly once you hit 20% equity.
Credit score matters more here than with VA loans. Lenders want 620 minimum, but 740+ gets you the best pricing in this market.
These loans shine when you're buying investment property or a second home near the beach. VA loans don't cover those scenarios.
VA loans let eligible veterans buy in Manhattan Beach with zero down. That's a massive advantage when homes here run well into seven figures.
You'll pay a funding fee upfront, but no monthly mortgage insurance ever. The VA guarantee lets lenders offer rates typically 0.25-0.5% below conventional.
Credit requirements are more forgiving. Many lenders approve VA loans at 580-600 credit scores that would get rejected for conventional financing.
Down payment separates these loans most dramatically. Conventional requires 3-20% cash, while VA needs nothing down if you're eligible.
Mortgage insurance works differently too. Conventional charges monthly PMI until you hit 20% equity. VA charges an upfront funding fee but nothing monthly, which improves your debt-to-income ratio.
Property type matters. VA only covers primary residences. Want that beach rental or second home? You need conventional financing.
If you're eligible for VA benefits and buying a primary residence, use the VA loan. Zero down and no monthly mortgage insurance crush conventional financing in Manhattan Beach's price range.
Conventional makes sense when VA doesn't apply: investment properties, second homes, or when you're buying with a non-spouse partner. It's also the move if you're trying to avoid the VA funding fee with a large down payment already saved.
Run the numbers both ways if you qualify for VA but have 20%+ down saved. Sometimes conventional with that equity beats VA after factoring the funding fee.
No. VA loans only cover primary residences where you'll live full-time. Investment properties and second homes require conventional financing.
Not anymore. VA eliminated loan limits for full-entitlement borrowers in 2020, so you can finance any price point if you qualify income-wise.
Most do. VA appraisals can be stricter, but in this market, qualified buyers are qualified buyers regardless of loan type.
Yes, through lender-paid mortgage insurance or piggyback loans. Both have tradeoffs, usually a higher interest rate to compensate.
First-time use runs 2.15% with zero down, dropping to 1.25% with 5%+ down. Subsequent use costs 3.3% with nothing down.
Not significantly. Both typically close in 30-45 days. VA appraisals can add a few days, but that's rarely a dealbreaker in Manhattan Beach.