Question 1

Can I use FHA for a $750,000 Redwood City home?

Accepted Answer

No, FHA caps at $644,000 in San Mateo County for 2025. You need conventional or jumbo financing above that limit.

Question 2

How much does FHA mortgage insurance actually cost?

Accepted Answer

1.75% upfront plus 0.55-0.85% yearly based on down payment. On a $650,000 loan that's roughly $11,375 rolled in plus $3,575-$5,525 annually.

Question 3

What credit score gets me the best conventional rate?

Accepted Answer

740 or higher unlocks tier-one pricing. You can get approved at 620, but expect rate hits of 0.5-1.5% compared to top-tier borrowers.

Question 4

Do Redwood City sellers prefer conventional offers?

Accepted Answer

Yes, especially on competitive listings. FHA appraisals require stricter property standards and can delay or kill deals sellers want to avoid.

Question 5

When does PMI drop off a conventional loan?

Accepted Answer

Automatically at 78% loan-to-value, or you can request removal at 80%. Typically happens after 3-8 years depending on down payment and appreciation.

Question 6

Can I put down more than 3.5% on an FHA loan?

Accepted Answer

Yes, but MIP still applies for 11+ years even at 5-9% down. At 10%+ down you escape MIP after 11 years instead of the full loan term.

Conventional vs FHA Loans in Redwood City: Which Gets You Home Faster?