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in Rocklin, CA
Rocklin buyers face a clear choice: conventional loans reward strong credit with lower costs, while FHA loans open doors for smaller down payments. Most Rocklin borrowers qualify for both, but one will cost less over time.
The difference isn't just rates. It's about upfront cash, monthly payments, and how long you plan to stay. Here's what actually matters when choosing between these two loan types in Placer County.
Conventional loans need 620+ credit and 3% down minimum. You'll pay private mortgage insurance until you hit 20% equity, then it drops off automatically. This is the cheapest option if your credit score exceeds 700.
With 20% down, you skip mortgage insurance entirely. That's a huge monthly savings compared to FHA. Conventional loans also work for second homes and investment properties, not just primary residences.
FHA loans accept 580 credit scores with 3.5% down. The upfront mortgage insurance is 1.75% of the loan amount, added to your balance. Monthly mortgage insurance stays for the life of the loan unless you put 10%+ down.
Debt-to-income ratios stretch higher with FHA—up to 50% in some cases. Sellers know FHA appraisals are stricter about property condition. Expect repair negotiations on older Rocklin homes.
Credit score drives the math. Above 700, conventional beats FHA on monthly cost. Below 680, FHA rates often win despite the insurance. The break-even point shifts with your score.
Mortgage insurance is permanent with FHA unless you refinance. Conventional PMI disappears at 20% equity without lifting a finger. Over 10 years in a Rocklin home, that difference adds up to $30,000+ on a median purchase.
Choose conventional if your credit exceeds 700 and you have 5%+ down. You'll pay less monthly and the insurance disappears. Most Rocklin buyers with stable W-2 income fit this profile.
Pick FHA if you're under 680 credit or stretching to afford the down payment. The upfront insurance hurts, but lower rates at that credit tier offset it. Plan to refinance to conventional once your score improves and equity builds.
Yes, once you hit 20% equity and your credit improves. Most borrowers refinance after 2-3 years to drop FHA mortgage insurance.
Minimum 620, but you'll get decent rates at 680+. Best pricing starts at 740 with conventional loans.
No, it's 3.5% everywhere with 580+ credit. High-cost area limits don't affect down payment percentages.
Both take 25-35 days typically. FHA appraisals can slow things if the home needs repairs.
Yes, it's disclosed in offers. Some sellers prefer conventional due to fewer appraisal issues, especially on older homes.