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in Livingston, CA
Most Livingston buyers choose between conventional and FHA loans. Both work well for Merced County properties, but they require different down payments and credit scores.
FHA loans let you buy with 3.5% down and a 580 credit score. Conventional loans need higher credit but drop mortgage insurance faster.
Your choice depends on how much cash you have saved and your credit profile. One program will cost you less over the loan term.
Conventional loans require 620+ credit and at least 3% down. Most Livingston buyers put down 5-10% to avoid jumbo territory and get better rates.
PMI drops off automatically at 78% loan-to-value. You can request removal at 80% LTV with an appraisal, often within 3-5 years.
These loans offer the lowest rates for borrowers with 740+ credit. Pricing improves significantly at 5% down versus 3%.
Debt-to-income limits reach 50% with strong credit and reserves. Lenders prefer seeing 2-6 months of payments in the bank.
FHA loans accept 580 credit scores with 3.5% down. Scores between 500-579 require 10% down but rarely get approved by lenders.
You pay 1.75% upfront mortgage insurance plus 0.55-0.85% annually. The monthly premium never drops off unless you refinance to conventional.
These loans allow higher debt ratios than conventional. You can qualify with 56.9% DTI if other factors compensate.
FHA works well for first-time buyers with limited savings. The 3.5% down requirement means less cash needed at closing.
Credit standards split these programs. FHA accepts 580 scores while conventional requires 620 minimum for standard pricing.
Mortgage insurance costs differ dramatically. FHA charges 1.75% upfront plus monthly premiums for the entire loan term.
Conventional drops PMI automatically once you hit 78% LTV. On a $400K loan, that saves $250-350 monthly after 5-7 years.
Down payment flexibility favors FHA at the minimum. But conventional becomes cheaper with 5%+ down and 740+ credit.
Choose FHA if your credit sits between 580-680 or you have exactly 3.5% saved. The flexible underwriting outweighs the lifetime insurance cost short-term.
Go conventional with 700+ credit and 5%+ down. You'll pay less monthly and eliminate PMI within years, not decades.
Plan to stay in the home under 5 years? FHA's lower down payment matters more than long-term insurance costs.
If you can hit 10% down, conventional wins for almost everyone. The rate advantage and removable PMI create significant savings over time.
Yes, through a refinance once you hit 20% equity and 620+ credit. Most borrowers refinance within 3-5 years to drop FHA insurance.
Conventional rates run 0.25-0.75% lower for borrowers with 740+ credit. FHA rates stay flat regardless of score above 580.
Yes, but FHA requires the complex to be FHA-approved. Conventional works on any warrantable condo with standard HOA finances.
FHA needs 3.5% minimum. Conventional requires 3-5% for best results, though some programs allow 3% for first-time buyers.
Both programs accept gift funds from family. FHA allows 100% gifted down payment while conventional varies by program.
Conventional typically closes in 21-30 days. FHA adds 3-5 days for appraisal requirements and FHA case number processing.