Loading
in Anaheim, CA
Anaheim buyers face a real choice: go conventional or FHA. The right answer depends on your credit, your down payment, and how long you plan to stay.
These two loans cover most purchase transactions in Orange County. Knowing the difference saves you money from day one.
Conventional loans aren't backed by the government. Lenders take on more risk, so they require stronger credit — typically 620 minimum, with better rates above 740.
Put down 20% and you skip private mortgage insurance entirely. That's a meaningful monthly savings in a high-price market like Anaheim.
FHA loans are insured by the Federal Housing Administration. That backing lets lenders approve borrowers with scores as low as 580 and just 3.5% down.
The trade-off is mortgage insurance. FHA charges an upfront premium plus a monthly fee — and unlike conventional PMI, it doesn't automatically drop off.
HousingWire flagged the 30-year fixed hitting 6.57% with applications down sharply. At those rates, FHA's mortgage insurance cost matters more — it compounds over time.
Conventional PMI disappears once you hit 20% equity. FHA mortgage insurance on loans with less than 10% down stays for the loan's life. In Anaheim's price range, that gap adds up fast.
Conventional loans also have higher conforming limits in Orange County. That gives buyers more room before needing a jumbo loan.
Strong credit above 700 and a solid down payment? Conventional almost always wins. Your rate is better and you're not locked into permanent mortgage insurance.
Credit in the 580-660 range or limited cash for closing? FHA gets you in the door. Just plan to refinance into conventional once your equity grows.
Rates vary by borrower profile and market conditions. Run both scenarios before you decide — the difference in total cost over five years can be significant.
Yes. FHA approves borrowers down to 580 with 3.5% down. Scores between 500 and 579 require 10% down.
Not always. Borrowers with lower credit often get better rates on FHA. Above 700, conventional is usually cheaper. Rates vary by borrower profile and market conditions.
Not easily. FHA loans originated with less than 10% down carry mortgage insurance for the life of the loan. Refinancing to conventional is the typical exit.
3% down is possible with conventional for qualified first-time buyers. But below 20%, you'll pay private mortgage insurance monthly.
Depends on your credit and savings. FHA is more accessible, but conventional can cost less over time if your credit qualifies. We compare both for every first-time buyer we work with.
Orange County has higher FHA limits than most U.S. counties. Check current limits before assuming FHA won't cover your target price — they may surprise you.