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in Pico Rivera, CA
Pico Rivera buyers looking to minimize upfront costs usually land on FHA or USDA loans. Both offer low barriers to entry, but they serve different borrower profiles.
FHA works almost anywhere in the city and accepts lower credit scores. USDA requires zero down but only applies to eligible areas and caps your income.
FHA loans let you buy with just 3.5% down if your credit score hits 580. You can go as low as 500 with 10% down, though most lenders set their own floor higher.
Every FHA loan carries mortgage insurance for the life of the loan unless you put down 10% or more. You'll pay an upfront premium at closing plus monthly premiums that add to your payment.
FHA works in every Pico Rivera neighborhood. No income caps, no property location restrictions. If you're buying a condo, it needs to be on the FHA-approved list.
USDA loans require zero down payment and charge no mortgage insurance. You pay an upfront guarantee fee and an annual fee, but both run lower than FHA's insurance costs.
The catch: your income can't exceed 115% of the area median, and the property must sit in a USDA-eligible zone. Most of Pico Rivera doesn't qualify because it's too densely populated.
USDA reviews household income, not just borrowers on the loan. If your adult kid lives with you and earns $40k, that counts toward the income limit even if they're not buying the house.
FHA accepts lower credit scores and works anywhere in Pico Rivera. USDA demands better credit—usually 640 minimum—and only covers specific zones that most of this city doesn't fall into.
USDA beats FHA on upfront costs if you qualify. No down payment means you're financing the entire purchase price, but you're not draining savings at closing.
FHA mortgage insurance sticks around until you refinance. USDA's annual fee drops off after the loan balance hits 80% of the original value, assuming you're current on payments.
Income limits kill USDA eligibility for many Pico Rivera households. A family of four can't earn more than about $103k. FHA doesn't care what you make as long as you can afford the payment.
Check USDA eligibility first. If the property qualifies and your household income clears the cap, USDA saves you money upfront and monthly. You'll need decent credit—most lenders want 640 or higher.
If you're buying in central Pico Rivera or your income exceeds USDA limits, FHA is your play. It costs more in insurance but works on any property and accepts lower credit scores.
Run the numbers on both. USDA's zero down payment looks great until you see that financing 100% of the purchase means higher total interest over 30 years compared to putting 3.5% down with FHA.
Most of Pico Rivera is too densely populated for USDA eligibility. Check the USDA property eligibility map with the specific address before assuming you qualify.
Yes. FHA doesn't require first-time buyer status. You can use it repeatedly as long as it's your primary residence and you meet credit and income requirements.
USDA typically costs less monthly due to lower fees and no down payment reducing your loan amount. Rates vary by borrower profile and market conditions.
FHA allows 580 for 3.5% down. USDA lenders usually require 640 minimum, though the program technically has no floor.
Yes. Refinance to a conventional loan once you hit 20% equity and decent credit. That's the only way to drop FHA insurance on loans with less than 10% down.