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in Truckee, CA
Both FHA and VA loans work in Truckee's mountain real estate market, but they serve different buyers. FHA loans require just 3.5% down and accept lower credit scores, making them accessible to most buyers who need help with down payment.
VA loans are exclusively for military members, veterans, and eligible spouses—but if you qualify, they beat FHA in almost every category. No down payment required, no mortgage insurance, and better rates are standard benefits that save thousands over the loan term.
FHA loans require 3.5% down with a 580 credit score, or 10% down if your score is 580-619. You'll pay an upfront mortgage insurance premium of 1.75% plus monthly premiums for the life of the loan on most purchases.
These loans accept higher debt ratios and recent credit events like bankruptcy or foreclosure. FHA works well for first-time buyers or anyone who needs flexible credit underwriting but doesn't have veteran status for a VA loan.
VA loans require zero down payment and charge no monthly mortgage insurance. You pay a one-time funding fee that ranges from 1.4% to 3.6% based on service type and down payment, but it's lower than FHA's ongoing insurance costs.
VA underwriting is more flexible than conventional loans and doesn't set a maximum loan amount—your eligibility depends on income and entitlement. Rates typically run 0.25% to 0.5% lower than FHA because the VA guarantee reduces lender risk.
Down payment is the biggest split: FHA needs 3.5% minimum while VA needs nothing. On a $700,000 Truckee home, that's $24,500 for FHA versus $0 for VA—plus VA skips monthly mortgage insurance that would cost $400-500 monthly on an FHA loan.
Eligibility separates these programs completely. Anyone with qualifying income and credit can get FHA approval, but VA requires military service connection through a Certificate of Eligibility. If you have the COE, VA beats FHA on cost and terms in every scenario.
If you have VA eligibility, use it. The zero down payment and no mortgage insurance create immediate savings and long-term equity advantages over FHA financing. VA's lower rates compound these benefits over a 30-year term.
Choose FHA only if you don't qualify for VA benefits. It's the best government loan option for non-military buyers who need low down payment options in Truckee's market, especially if your credit score sits below conventional loan minimums.
No—both programs require owner occupancy as your primary residence. Investment properties and second homes don't qualify for either government loan program.
Both work if the project is FHA or VA approved. VA is stricter on condo approvals, so some complexes accept FHA but not VA financing.
Neither program caps your income. Both require you to prove sufficient income to afford the payment, but high earners can use either loan type.
Yes—veterans with service-connected disabilities are exempt. Everyone else pays the fee, though you can roll it into the loan amount instead of paying cash.
FHA typically closes slightly faster because VA requires additional property inspections. Both take 30-45 days with an experienced lender who knows government loan requirements.