Question 1

Can I use an FHA loan to buy a multi-unit property in Hollister?

Accepted Answer

Yes, FHA allows 2–4 unit properties if you occupy one unit. Conventional also permits this but requires stronger credit and more reserves.

Question 2

Does FHA or conventional have higher loan limits in San Benito County?

Accepted Answer

Both programs set conforming limits by county. Check current FHFA and FHA limits for San Benito County before assuming either covers your purchase price.

Question 3

Which loan is easier to qualify for with a low credit score?

Accepted Answer

FHA wins here. It accepts scores down to 580 with 3.5% down. Conventional lenders typically require at least 620.

Question 4

How does mortgage insurance differ between the two loans?

Accepted Answer

FHA charges a 1.75% upfront fee plus monthly premiums that usually last the life of the loan. Conventional PMI cancels once you hit 80% loan-to-value.

Question 5

Can I switch from FHA to conventional later?

Accepted Answer

Yes, refinancing from FHA to conventional is common once you have 20% equity. This removes mortgage insurance and can lower your monthly payment.

Question 6

Which loan works better for a first-time buyer in Hollister?

Accepted Answer

FHA is often the first step for buyers with limited savings or credit history. Conventional is better if you qualify — it costs less over time.

Conventional vs FHA Loans in Hollister, CA