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in Montclair, CA
Most Montclair buyers choose between two loan types: conventional and FHA. The right one depends on your credit, savings, and how long you plan to stay.
HousingWire flagged the 30-year fixed hitting 6.57% — that gap in mortgage insurance costs between these two loans matters more than ever right now. Rates vary by borrower profile and market conditions.
Conventional loans aren't government-backed. That means stricter credit requirements, but also fewer fees and more flexible terms once you qualify.
Put down 20% and you avoid private mortgage insurance entirely. That's a meaningful monthly savings most FHA borrowers can't access.
FHA loans are insured by the federal government. That backing lets lenders approve borrowers with lower scores and smaller down payments.
You can get in with 3.5% down and a 580 credit score. Scores between 500–579 may still qualify — but require 10% down.
The biggest difference is mortgage insurance. FHA charges it upfront and annually — often for the full loan term. Conventional PMI cancels once you hit 20% equity.
Conventional loans also allow higher loan amounts and more property types. FHA has limits set by county, and San Bernardino County limits apply here in Montclair.
Strong credit above 700 and at least 5–10% down? Conventional will almost always cost less over time. The PMI cancellation alone saves thousands.
Credit in the 580–640 range or limited savings? FHA gets you in the door when conventional won't. Just price in the long-term MIP cost before you commit.
Yes. Once you build enough equity and your credit improves, refinancing into conventional removes the permanent MIP. Many Montclair buyers do this after 2–3 years.
FHA allows 3.5% down with a 580 score. Conventional can go as low as 3%, but typically requires stronger credit to get there.
Conventional loans often close faster. FHA requires a specific appraisal process that can add time if the property has condition issues.
No. Limits are set by county. San Bernardino County has its own FHA limit — confirm the current figure before setting your purchase price.
FHA 203k lets you finance repairs into the loan. Standard conventional loans don't. If the home needs work, FHA rehab programs have a real edge.
Not always. Conventional loans drop PMI at 20% equity. FHA charges MIP upfront and monthly — often for the entire loan term.