Loading
in Milpitas, CA
Both FHA and VA loans offer government backing that makes homeownership more accessible in Milpitas. FHA loans serve a broad range of buyers with lower credit and down payment requirements. VA loans provide exclusive benefits to military members and veterans.
Understanding the differences between these programs helps you choose the right path for your Milpitas home purchase. Each loan type has distinct advantages depending on your background and financial situation.
FHA loans require as little as 3.5% down and accept credit scores as low as 580. The Federal Housing Administration insures these mortgages, which reduces lender risk and opens doors for buyers who might not qualify for conventional financing.
You'll pay an upfront mortgage insurance premium plus monthly mortgage insurance. These costs continue for the life of the loan if you put down less than 10%. FHA loans work well for first-time buyers and those rebuilding credit.
Santa Clara County buyers benefit from FHA loan limits that accommodate higher home prices. The program allows gift funds for down payments and closing costs from family members.
VA loans require zero down payment for eligible veterans, active-duty service members, and qualifying spouses. The Department of Veterans Affairs guarantees these loans, eliminating the need for private mortgage insurance.
You'll pay a one-time funding fee that varies based on your service history and down payment amount. Veterans with service-connected disabilities may receive a funding fee waiver. VA loans typically offer competitive interest rates.
The program sets limits on closing costs lenders can charge. Sellers can pay all buyer closing costs, which reduces cash needed at closing. VA loans don't require monthly mortgage insurance regardless of down payment.
Eligibility separates these programs most clearly. Anyone meeting credit and income requirements can use FHA financing. VA loans require military service or qualifying family connections. This fundamental distinction determines which program you can access.
Down payment requirements differ significantly. FHA requires 3.5% minimum while VA allows zero down for eligible borrowers. Monthly mortgage insurance costs also vary—FHA charges ongoing premiums while VA doesn't require monthly insurance.
Upfront costs follow different patterns. FHA charges a 1.75% upfront mortgage insurance premium. VA assesses a funding fee ranging from 1.4% to 3.6% depending on service type and down payment. Both fees can be rolled into the loan amount.
VA loans typically offer better terms if you qualify through military service. Zero down payment and no monthly mortgage insurance reduce both upfront and ongoing costs. The funding fee waiver for disabled veterans provides additional savings.
FHA makes sense when you don't qualify for VA benefits or need more flexible credit requirements. The program serves buyers with limited savings and those rebuilding credit. Both loan types accommodate Milpitas home prices effectively.
Consider working with a lender familiar with both programs. They can calculate total costs over your expected ownership period. This analysis reveals which option saves you more money based on your specific situation.
You can only have one primary residence loan at a time through either program. Some veterans use VA loan benefits multiple times throughout their lives, but not simultaneously for multiple properties.
VA loans typically offer slightly lower rates due to zero down payment risk and government backing. Rates vary by borrower profile and market conditions. Both programs generally beat conventional loan rates.
Yes, both FHA and VA approve financing for condos if the complex meets program requirements. The condo association must be on the approved list for the respective program.
Sellers can accept or reject any offer regardless of financing type. Some worry about appraisal requirements, but both FHA and VA appraisals protect buyers and sellers alike.
Both programs typically close in 30-45 days with proper preparation. VA loans may take slightly longer due to additional certificate verification. Experienced lenders handle both efficiently.