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in Chowchilla, CA
Chowchilla sits in USDA-eligible territory, making it one of the few California cities where buyers can choose between FHA's 3.5% down and USDA's zero down option. Both programs offer government backing with flexible credit, but the right choice depends on your income and upfront cash.
Most Chowchilla buyers default to FHA without realizing USDA could save them thousands at closing. The catch is USDA's income caps and property location rules, which FHA doesn't impose.
FHA loans work anywhere in Chowchilla with just 3.5% down and 580 credit. You'll pay an upfront mortgage insurance premium of 1.75% plus monthly MI that stays for the loan's life on most purchases.
No income caps make FHA the fallback when you earn too much for USDA or want a property outside USDA zones. Debt-to-income ratios stretch to 50% with compensating factors, and sellers can cover up to 6% of closing costs.
USDA loans require zero down payment in Chowchilla's eligible areas, but you must meet income limits based on household size. Single borrowers typically cap around $103,500 annual income, while families of four max near $136,700.
You'll pay a 1% upfront guarantee fee and 0.35% annual fee instead of FHA's heavier mortgage insurance. Credit scores down to 580 work with manual underwriting, though 640+ gets you automated approval and better terms.
The 3.5% down payment gap is the obvious split, but ongoing costs matter more long-term. FHA charges 0.55%-0.80% annual mortgage insurance that never cancels, while USDA's 0.35% fee drops when you refinance or pay down the loan.
Income limits kill most USDA deals in Chowchilla. A household earning $140,000 can't use USDA but qualifies easily for FHA. Property eligibility also differs since USDA restricts certain home types and locations FHA accepts without issue.
Choose USDA if you're under the income limits and buying in an eligible zone. Saving the down payment and paying lower monthly insurance makes it the clear winner when you qualify. Just confirm the specific property address passes USDA's eligibility map before writing offers.
Pick FHA when your income exceeds USDA caps, you need a condo or manufactured home USDA won't touch, or you want faster closing timelines. FHA also makes sense if you're stretching debt ratios since underwriters allow higher back-end percentages than USDA typically approves.
Most of Chowchilla qualifies, but you must check the USDA eligibility map for your specific address. Some areas near city centers don't qualify.
Single borrowers max around $103,500 and four-person households cap near $136,700. Limits adjust annually and vary by household size.
Only if you put down 10% or more, then it cancels after 11 years. With 3.5% down, it stays for the loan's life.
USDA typically runs $50-80 lower per month on a $300,000 loan due to cheaper mortgage insurance. Rates vary by borrower profile and market conditions.
Yes, both FHA and USDA accept grant programs. USDA's zero-down structure makes grants less critical unless you need closing cost help.