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in Hollister, CA
Hollister buyers choosing between Conventional and VA loans face very different qualification paths. VA loans require military service but offer zero down payment, while Conventional loans work for anyone with strong credit and savings.
The right choice depends on whether you're eligible for VA benefits. Service members and veterans get unbeatable terms through VA financing that Conventional loans can't match.
Conventional loans follow guidelines set by Fannie Mae and Freddie Mac. You typically need 620+ credit and 3-5% down, though 20% down eliminates mortgage insurance.
These mortgages work for primary homes, second homes, and investment properties. Rates vary by borrower profile and market conditions, with best pricing going to borrowers with 740+ credit and 20% equity.
Most Conventional buyers in Hollister use these loans because they're not eligible for VA benefits. The programs offer predictable underwriting and work with most property types.
VA loans guarantee financing for veterans, active-duty service members, and qualifying surviving spouses. You put zero down and pay no monthly mortgage insurance regardless of loan amount.
The VA charges a one-time funding fee between 1.4-3.6% of the loan amount, but disabled veterans get this waived. Sellers can pay all your closing costs, making this the lowest cash-to-close option available.
VA loans require a certificate of eligibility proving your service. Credit standards are flexible compared to Conventional financing, and most lenders approve borrowers with 580+ credit.
Down payment separates these programs most. Conventional requires 3-20% down while VA needs zero for eligible borrowers, saving $15,000-$60,000 upfront on typical Hollister homes.
Mortgage insurance works differently too. Conventional charges monthly PMI until you hit 20% equity. VA has no monthly insurance but collects a funding fee at closing that gets rolled into your loan.
Eligibility creates the biggest divide. Anyone with decent credit qualifies for Conventional loans. VA loans require military service documentation that most buyers don't have.
Use VA financing if you're eligible, period. The zero-down benefit and no mortgage insurance save you tens of thousands compared to Conventional loans, even with the funding fee.
Go Conventional if you're not a veteran or service member. You can't access VA benefits without a certificate of eligibility, making Conventional your best option with good credit and some savings.
Some eligible veterans still choose Conventional for investment properties or when they've already used VA entitlement. But for primary home purchases in Hollister, VA financing beats Conventional terms every time if you qualify.
Most VA lenders approve 580+ credit scores, much lower than Conventional's 620 minimum. Your service record matters more than perfect credit history.
No. VA loans typically offer lower rates than Conventional, and eliminating mortgage insurance saves $150-300 monthly on typical Hollister purchases.
Yes. You can reuse VA benefits after selling a previous VA-financed home or have enough remaining entitlement for multiple simultaneous VA loans.
Investment properties don't qualify for VA financing. Some veterans also use Conventional when buying above VA loan limits or making very competitive offers.
Rarely. VA's funding fee gets financed into the loan, while Conventional demands 3-20% cash down at closing. VA requires far less money upfront.