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in Paramount, CA
Paramount buyers face a clear choice: conventional loans with lower costs over time, or FHA loans with easier entry. Your credit score and down payment cash determine which path makes sense.
Most Paramount properties work with either loan type. The real difference shows up in your monthly payment and upfront costs.
Conventional loans require 620+ credit and 3% down minimum. You pay mortgage insurance only until you hit 20% equity, then it drops off automatically.
Rates beat FHA if your credit tops 680. You also avoid the upfront mortgage insurance premium FHA charges at closing.
Sellers prefer conventional offers in competitive situations. No appraisal repair requirements means fewer deal-killers during inspection.
FHA loans accept 580 credit scores with 3.5% down. You can qualify with a 43% debt ratio, higher than most conventional guidelines allow.
You pay 1.75% upfront mortgage insurance at closing, then monthly premiums for the loan's life. That upfront fee adds roughly $5,000 on a $300,000 purchase.
FHA appraisals flag safety issues and required repairs. Chipped paint, handrails, and roof condition can stall your closing until fixed.
Credit score creates the biggest cost gap. At 640 credit, FHA wins on rate. At 700 credit, conventional saves you $150+ monthly.
Down payment math favors FHA for thin savings accounts. Conventional needs more cash upfront but costs less over five years.
Mortgage insurance lasts forever on FHA loans under 10% down. Conventional lets you cancel it once you build equity, saving thousands long-term.
Choose FHA if your credit sits between 580-679 or you barely have 3.5% down. The upfront and monthly insurance costs hurt, but you can refinance to conventional later.
Pick conventional with 680+ credit and 5% down saved. You'll pay less monthly and dump mortgage insurance faster. Rates vary by borrower profile and market conditions.
Plan to stay under five years? FHA's lower down payment might win despite higher monthly costs. Buying your forever home? Conventional saves more as equity builds.
Yes, refinance once you hit 20% equity and 620+ credit. You'll eliminate FHA's lifetime mortgage insurance and likely lower your rate.
Conventional typically closes quicker. FHA appraisals often require repair negotiations that add 1-2 weeks to your timeline.
Some do in multiple-offer situations. FHA repair requirements and appraisal conditions make conventional offers more attractive to sellers.
Around 680 is the breakeven point. Above that score, conventional rates and lower insurance costs beat FHA monthly payments.
No, FHA requires minimum 3.5% down with 580+ credit. Conventional allows 3% down but demands higher credit scores for that option.