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in Millbrae, CA
Millbrae sits on the Peninsula where home prices hit harder than most Bay Area suburbs. FHA and USDA loans both offer government backing, but they serve different buyers with different advantages.
FHA works anywhere in San Mateo County with just 3.5% down. USDA requires zero down but has strict income caps and only covers properties outside urban boundaries — which eliminates most of Millbrae proper.
FHA loans let you buy with 3.5% down if your credit score hits 580. You'll pay mortgage insurance for the loan's life on most purchases, which adds to your monthly payment but keeps the upfront barrier low.
Credit scores as low as 500 qualify with 10% down. Debt-to-income ratios stretch to 43%, sometimes higher with compensating factors. Sellers can contribute up to 6% toward closing costs.
USDA loans require zero down payment but you must buy in an eligible rural area and stay under income limits. San Mateo County's median income runs too high for most Millbrae buyers to qualify.
USDA charges an upfront guarantee fee of 1% and annual fees of 0.35%. Both are lower than FHA's insurance costs. You need 640+ credit and income below 115% of the area median for your household size.
Location determines whether USDA is even an option. Most of Millbrae falls inside urbanized boundaries that USDA excludes. Check the USDA eligibility map before you waste time on income calculations.
Income matters more for USDA. A family of four in San Mateo County can't exceed roughly $128,000 in annual income. FHA has no income ceiling — you just need enough income to cover the mortgage payment and debts.
FHA mortgage insurance costs more over time. USDA's annual fee of 0.35% beats FHA's 0.55% to 0.85%. On a $600,000 loan, that's $1,200 less per year in insurance costs.
USDA only works if your target property sits in an eligible zone and your household income falls below the cap. For most Millbrae buyers, that rules USDA out immediately.
FHA fits buyers who need flexible credit terms and can manage 3.5% down. It's the default choice when USDA geography or income limits don't align. You'll pay more in insurance but gain location freedom.
Most of Millbrae is ineligible under USDA maps. Some properties on the city's edges may qualify, but you'll need to verify the exact address on the USDA eligibility site.
For a family of four, the limit sits around $128,000 annually as of early 2026. That number adjusts based on household size and USDA's annual area median income updates.
USDA costs less long-term at 0.35% annually. FHA ranges from 0.55% to 0.85% depending on loan size and term, plus a 1.75% upfront premium.
You can't drop FHA insurance on loans after June 2013. You'd need to refinance into a conventional loan once you hit 20% equity to eliminate it.
USDA adds processing time for income verification and property eligibility checks. Expect 45-60 days versus 30-45 for FHA in most cases.