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in Rocklin, CA
Both FHA and VA loans offer government backing, but they serve different borrowers in Rocklin. FHA works for anyone who qualifies, while VA is exclusive to military members and veterans.
The choice often comes down to eligibility first, then cost. If you qualify for VA, you'll typically save thousands over FHA through the life of your loan.
FHA loans require just 3.5% down with credit scores as low as 580. You'll pay an upfront mortgage insurance premium of 1.75% plus annual premiums that run 0.55% to 0.85% of your loan amount.
These loans work well for first-time buyers in Rocklin who haven't served in the military. The catch is mortgage insurance stays for the loan's life unless you put down 10% or more.
FHA accepts higher debt ratios than conventional loans, often up to 50% depending on compensating factors. This flexibility helps buyers with student loans or car payments qualify for Placer County homes.
VA loans require zero down and charge no monthly mortgage insurance. You'll pay a one-time funding fee between 1.4% and 3.6% based on down payment and whether it's your first VA loan.
Veterans and active-duty service members get the strongest government loan program available. Credit requirements are flexible, and sellers can pay up to 4% toward your closing costs.
VA loans accept credit scores down to 580 at most lenders, though 620 gets better pricing. There's no maximum debt ratio written into VA guidelines, giving underwriters discretion on strong files.
The biggest split is eligibility and mortgage insurance. VA eliminates monthly MI entirely, while FHA charges it permanently unless you refinance later or put 10% down initially.
Down payment separates them clearly: FHA needs 3.5%, VA needs nothing. On a Rocklin home, that difference could mean keeping $15,000 to $20,000 in your pocket at closing.
Both programs allow gift funds and seller concessions. VA edges ahead with a 4% seller contribution limit versus FHA's 6% cap, though that matters less than the insurance savings.
If you have VA eligibility, use it. The lack of monthly mortgage insurance saves $150 to $250 per month on typical Rocklin home prices, which adds up to $50,000+ over a 30-year loan.
Choose FHA when you're not military-connected but need the low down payment and flexible credit. It costs more monthly than VA but still beats conventional loans for buyers with limited cash or credit challenges.
Some veterans still use FHA when their VA eligibility is tied up in another property. You can restore VA benefits after selling or refinancing that first home.
Yes, but it rarely makes sense. VA saves you thousands in mortgage insurance and requires no down payment, making it the better choice in nearly every scenario.
Both accept 580 credit scores and high debt ratios. VA often approves borderline files more easily since it has no hard debt ratio cap.
VA and FHA are equally accepted. Both appraisals can be stricter than conventional, but that's property-specific, not a deal-killer in Rocklin's newer housing stock.
You can reuse VA benefits after selling your previous home or paying off that loan. First-time VA users pay lower funding fees than repeat users.
Only by putting 10% down, which keeps MI for 11 years instead of the loan's life. At that point, conventional loans usually make more sense.