Question 1

Can I use USDA financing anywhere in Pacific Grove?

Accepted Answer

No. USDA restricts loans to designated rural areas. Check the USDA eligibility map before making offers.

Question 2

Which loan has lower monthly insurance costs?

Accepted Answer

USDA charges 0.35% annually versus FHA's 0.55% to 0.85%. USDA saves money over the loan term.

Question 3

Do both programs allow gift funds for down payment?

Accepted Answer

Yes. FHA accepts gifts for the 3.5% down. USDA allows gifts for closing costs since no down payment is required.

Question 4

What income limits apply to FHA loans in Monterey County?

Accepted Answer

FHA has no income limits. USDA caps household income around $120,000 in this area.

Question 5

Can I refinance out of mortgage insurance later?

Accepted Answer

USDA lets you refinance out if property value rises. FHA insurance stays for the loan's life on most loans.

FHA vs USDA Loans in Pacific Grove: Which Government Program Fits Your Budget?