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Most Daly City buyers look at FHA first because it's available everywhere. But USDA loans offer zero down if you qualify — and parts of San Mateo County are still eligible.
The choice comes down to location and income. FHA works anywhere in Daly City with 3.5% down. USDA requires zero down but has strict address and income caps.
Both programs charge mortgage insurance, but in different ways. FHA adds upfront and monthly premiums. USDA charges a guarantee fee plus annual insurance that's often cheaper.
FHA loans require 3.5% down with a 580 credit score, or 10% down if you're between 500-579. There's no income cap, so high earners can use FHA if they want the low down payment.
You pay 1.75% upfront mortgage insurance at closing, then 0.55%-0.85% annually depending on loan size and term. The monthly premium lasts the life of the loan on most purchases.
FHA works in every Daly City neighborhood. Loan limits hit $644,000 for a single-family home as of February 2026, covering most starter homes but not luxury properties.
USDA loans require zero down but limit eligibility to specific areas and income levels. Most of Daly City sits too close to San Francisco to qualify, but check the USDA map — some edge zones may work.
Income can't exceed 115% of the area median, roughly $152,000 for a family of four in San Mateo County. The property must be your primary residence, no investment homes.
USDA charges a 1% guarantee fee upfront and 0.35% annually. That annual premium is half what FHA costs, and it drops off once you hit 20% equity if you put down 10% or more at closing.
Local decision guide
Use this comparison to weigh FHA Loans and USDA Loans through local payment fit, eligibility, documentation, and timing before choosing a path in Daly City.
Most Daly City buyers look at FHA first because it's available everywhere. But USDA loans offer zero down if you qualify — and parts of San Mateo County are still eligible.
The choice comes down to location and income. FHA works anywhere in Daly City with 3.5% down. USDA requires zero down but has strict address and income caps.
Both programs charge mortgage insurance, but in different ways. FHA adds upfront and monthly premiums. USDA charges a guarantee fee plus annual insurance that's often cheaper.
Down payment separates these programs immediately. FHA needs 3.5%, USDA needs nothing. But USDA restricts where you can buy and how much you earn — FHA doesn't.
Mortgage insurance costs less with USDA. Annual premiums run 0.35% versus 0.55%-0.85% for FHA. Over 30 years, that saves tens of thousands if you stay in the loan.
FHA accepts lower credit scores and works with bankruptcies sooner than conventional loans. USDA typically wants 640+ credit, though exceptions exist. Processing times favor FHA because USDA adds a rural development review step.
Check USDA eligibility first. If your address and income qualify, zero down beats 3.5% down every time. You'll save on upfront cash and pay lower insurance for the life of the loan.
If you're outside USDA zones or earn too much, FHA becomes the clear choice. It's the most forgiving government program for credit and works in every neighborhood.
With rate cuts expected later this year per recent Fed comments, locking either loan now versus waiting depends on how fast you need to move. FHA gives you flexibility to act quickly anywhere in Daly City.
Most of Daly City is ineligible because it's too urban. Check the USDA property eligibility map — some outlying areas may qualify.
USDA costs less annually at 0.35% versus FHA's 0.55%-0.85%. USDA insurance can also drop off eventually, FHA's typically doesn't.
No. FHA has no income cap, so high earners can use it. USDA restricts income to 115% of area median.
FHA closes quicker because USDA adds a rural development review step. Expect 30-45 days for FHA, 45-60 for USDA.
FHA approves condos if the building is FHA-approved. USDA allows condos in eligible rural areas but Daly City condos rarely qualify geographically.
in Daly City, CA