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in Monrovia, CA
Monrovia sits in a unique spot where both FHA and USDA loans can work depending on the property location. Most buyers assume USDA only applies to farmland, but parts of LA County still qualify.
Both loans help buyers who don't have 20% down. The difference comes down to where you're buying and what you earn.
FHA loans work anywhere in Monrovia with just 3.5% down if your credit score hits 580. You'll pay an upfront mortgage insurance premium of 1.75% plus annual premiums that vary by loan amount and down payment.
Credit scores as low as 500 can qualify with 10% down. FHA accepts higher debt ratios than conventional loans, which helps buyers with student loans or car payments. You can use gift funds for the entire down payment from family members.
USDA loans require zero down payment but only work in eligible rural areas. Some parts of eastern LA County qualify, though most of Monrovia proper does not. You must check the USDA property eligibility map before falling in love with a house.
Income limits apply based on household size and county median income. For LA County, most families earning under $110,000 qualify. USDA charges a 1% upfront guarantee fee and 0.35% annual fee, lower than FHA's ongoing costs.
Location decides this comparison for most buyers. FHA works everywhere while USDA only covers specific zones outside urban centers. If the property isn't USDA-eligible, FHA becomes your only low-down-payment government option.
Income matters more with USDA because strict limits disqualify higher earners. FHA has no income cap but requires more upfront cash. USDA's zero down beats FHA's 3.5% if you qualify on both fronts.
Check USDA eligibility first if you earn under the income limits and prefer zero down. Most Monrovia properties won't qualify, but nearby areas might. Run the address through the USDA map before getting prequalified.
Choose FHA if the property sits in central Monrovia or your income exceeds USDA limits. FHA gives you more property choices and works with lower credit scores. The 3.5% down payment is still manageable compared to conventional 5-10% requirements.
Most of central Monrovia doesn't qualify as USDA-eligible. Properties on the eastern edges near Bradbury may work, but you must verify each address on the USDA eligibility map.
USDA typically costs less monthly due to zero down payment and lower annual fees. FHA requires 3.5% down but charges higher mortgage insurance premiums throughout the loan.
FHA accepts gift funds from family for the full 3.5% down payment. USDA requires zero down so gift funds aren't needed, though you can use them for closing costs.
FHA accepts scores as low as 580 for 3.5% down or 500 with 10% down. USDA typically requires 640 minimum though some lenders go lower with compensating factors.
Only if your property sits in a USDA-eligible zone and you meet income limits at refinance time. Most Monrovia homes won't qualify for USDA regardless of when you apply.