Question 1

Can I use an FHA loan on a condo in Carpinteria?

Accepted Answer

Only if the condo complex is FHA-approved. Many California condo projects aren't on the approved list. Check the HUD database before making an offer.

Question 2

Is FHA mortgage insurance permanent?

Accepted Answer

On most FHA loans with less than 10% down, yes — MIP stays for the life of the loan. The only way out is to refinance into a conventional loan later.

Question 3

What credit score do I need for a conventional loan?

Accepted Answer

Lenders require at least 620. But your rate improves significantly at 740 and above. Below 680, conventional pricing often loses to FHA.

Question 4

Which loan has a higher limit in Santa Barbara County?

Accepted Answer

Conventional conforming limits are set annually by FHFA. FHA limits are set separately and are typically lower. In high-cost counties, both get adjusted upward.

Question 5

Can I put 3% down on a conventional loan?

Accepted Answer

Yes. Programs like Fannie Mae's HomeReady and Freddie Mac's Home Possible allow 3% down. You'll pay PMI until you reach 20% equity.

Question 6

Which loan is better for a competitive offer in Carpinteria?

Accepted Answer

Conventional. Sellers and listing agents view FHA offers as higher risk due to stricter appraisal requirements. In a tight market, that difference can cost you the deal.

Conventional vs FHA Loans in Carpinteria, CA