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in Mill Valley, CA
Mill Valley sits in Marin County where home prices run high and USDA eligibility gets tricky. Most of the city falls outside USDA rural designations, which means FHA loans dominate the local government loan market.
Both programs help buyers with limited cash or credit challenges. The key difference is where you can use them and how much you need for a down payment.
FHA loans work anywhere in Mill Valley 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 580 minimum.
These loans carry mortgage insurance for the life of the loan unless you refinance out. Upfront MIP costs 1.75% of your loan amount, and you pay annual premiums of 0.55% to 0.85% depending on loan size and term.
FHA allows debt-to-income ratios up to 50% in most cases. That flexibility helps buyers in expensive markets like Marin County who earn solid incomes but face high housing costs.
USDA loans require zero down payment but come with strict location rules. In Mill Valley, only scattered pockets on the edges qualify as rural enough for USDA designation.
You must meet income limits set by household size and county. For Marin County, most families hit the cap before they qualify, which eliminates USDA as an option for many local buyers.
USDA charges a 1% upfront guarantee fee and 0.35% annual fee. That annual cost is lower than FHA, and you can cancel it once you hit 20% equity through a refinance.
Down payment separates these programs most clearly. FHA needs 3.5% while USDA requires nothing, but that zero down only works if your property sits in an eligible zone.
Income limits hit hard with USDA in Marin County. FHA has no income cap, so high earners who want low down payment financing can still qualify.
Both programs allow similar credit scores and debt ratios. The real deciding factors are property location and whether you have cash for a down payment.
Check USDA eligibility first. If your target property qualifies and your income falls under the limit, zero down beats 3.5% down every time.
Most Mill Valley buyers end up with FHA because eligible properties are scarce and local incomes run high. FHA gives you more flexibility on location and no income restrictions.
Run the numbers on mortgage insurance before you commit. USDA's lower annual fee saves money long-term, but only if you can find an eligible property you actually want to buy.
No. Most of Mill Valley falls outside USDA eligible zones. Check the USDA property eligibility map before you start your home search.
USDA charges 0.35% annually versus FHA's 0.55% to 0.85%. USDA costs less over time if you qualify.
Yes. Both allow 580 credit scores with most lenders. USDA technically goes to 640, but many lenders match FHA at 580.
No. FHA has no income cap, which makes it the go-to option for higher earners in Marin County.
No. Both FHA and USDA require you to occupy the home as your primary residence.