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in Pico Rivera, CA
Both FHA and VA loans help Pico Rivera buyers get into homes with less cash up front than conventional loans require. The right choice depends entirely on your military service history and how much you can put down.
FHA loans work for anyone who qualifies. VA loans only serve eligible veterans, active-duty military, and qualifying spouses. If you qualify for VA, it's almost always the better deal.
FHA loans require just 3.5% down with a 580 credit score, or 10% down if your score sits between 500-579. You'll pay an upfront mortgage insurance premium of 1.75% plus monthly premiums that last the life of the loan on most purchases.
These loans shine for first-time buyers in Pico Rivera who don't have military service. Debt-to-income ratios can stretch to 50% with strong compensating factors. Sellers can contribute up to 6% toward closing costs.
VA loans require zero down payment and charge no monthly mortgage insurance ever. You pay a one-time funding fee that ranges from 1.4% to 3.6% based on down payment and military service type, but veterans with service-connected disabilities get this waived completely.
Credit requirements stay flexible with most lenders approving 620 scores, though we see approvals in the high 500s with clean payment history. Debt ratios stretch higher than FHA when residual income guidelines pass. Sellers can pay all closing costs.
The down payment gap matters most. FHA needs at least 3.5% down while VA needs nothing. On a $500,000 Pico Rivera home, that's $17,500 in cash you keep with VA. Monthly mortgage insurance adds another $200-300 per month on FHA that VA borrowers skip entirely.
Eligibility creates the hard line. FHA accepts anyone who meets credit and income requirements. VA requires military service with a Certificate of Eligibility. If you served and qualify for VA, you gain significant financial advantages that FHA can't match.
Use VA if you qualify for it. The zero down requirement and absence of monthly mortgage insurance create thousands in savings over any FHA loan. The only exception is if your funding fee exceeds what you'd pay in FHA premiums, which happens rarely and only with repeat VA use and zero down.
Choose FHA if you don't have military service or your VA eligibility is already tied up in another property. FHA provides the next best option for lower down payments and flexible credit in Pico Rivera. Just plan to refinance out of that mortgage insurance once you hit 20% equity.
Yes, if you have remaining entitlement or pay off your existing VA loan. Many veterans have enough entitlement for multiple properties simultaneously.
Yes on most loans with less than 10% down. You'd need to refinance to conventional to remove it once you reach 20% equity.
VA loans typically price 0.25% to 0.5% lower than FHA. Rates vary by borrower profile and market conditions.
Sellers can refuse any offer, but both loan types close reliably. VA appraisals require specific repairs that sometimes concern sellers.
FHA requires 580 for minimum down, 500 with larger down. VA typically needs 620, though some lenders go lower with strong profiles.
Both run 2-5% of loan amount. VA allows sellers to pay all costs, FHA caps seller credits at 6% of price.