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in Mammoth Lakes, CA
Mammoth Lakes sits in a unique lending zone where both FHA and USDA loans work. Most mountain buyers assume they need 20% down, but these government programs offer alternatives.
FHA requires just 3.5% down with flexible credit. USDA offers zero down if you meet income limits. Both have trade-offs worth understanding before you apply.
FHA loans require 3.5% down with credit scores as low as 580. You pay upfront mortgage insurance (1.75% of loan amount) plus annual premiums that don't drop off.
The big advantage: no income caps and you can use the loan anywhere in Mono County. Second homes don't qualify, but primary residences including condos do.
Sellers here often prefer FHA buyers over USDA because FHA appraisals close faster. You'll compete better than a zero-down offer in most cases.
USDA loans require zero down payment if you're under the income limit. For Mono County, that's $103,500 for households of 1-4 people.
Most of Mammoth Lakes qualifies as USDA-eligible rural area. You pay a 1% upfront guarantee fee and 0.35% annual fee, both lower than FHA insurance costs.
The catch: USDA processing takes 4-6 weeks longer than FHA. You also can't exceed income caps, which knocks out many Mammoth buyers earning Bay Area remote salaries.
Down payment splits these loans. FHA needs 3.5% minimum while USDA requires nothing upfront. On a $600,000 cabin, that's $21,000 versus zero.
Income limits separate qualified buyers. USDA caps household income at $103,500 in Mono County. FHA has no income restriction, so high earners with limited savings often choose it.
Processing speed matters in mountain markets with short selling seasons. FHA appraisals clear in 2-3 weeks. USDA adds a month of underwriting because loans route through USDA's rural development office.
Choose USDA if you earn under $103,500 and have minimal savings. The zero down payment and lower insurance costs beat FHA economics. Just budget extra time for closing.
Pick FHA if you exceed USDA income limits or need to close quickly. Sellers in Mammoth's competitive summer market often won't wait the extra month USDA processing requires.
Neither loan works for second homes or investment properties. If you're buying a vacation rental, you need conventional financing with 10-15% down minimum.
No, USDA only finances single-family homes. Condos require FHA or conventional financing regardless of income level.
FHA accepts 580 minimum. USDA typically requires 640 credit, though exceptions exist for strong compensating factors.
USDA costs less long-term with 0.35% annual fees. FHA charges 0.55-0.85% annually depending on down payment and loan term.
USDA allows it once you hit 20% equity. FHA loans after 2013 require insurance for the full loan term.
FHA caps at $498,257 for 2024. USDA has no set maximum but your income must support the payment under debt-to-income rules.