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in Benicia, CA
Both FHA and VA loans offer government backing that makes homeownership accessible in Benicia. But they serve different buyers with different requirements and benefits.
FHA loans work for any qualified borrower with modest savings. VA loans reward military service with superior terms but strict eligibility rules.
Understanding which program you qualify for—and which saves you more money—determines your buying power in Solano County.
FHA loans require just 3.5% down if your credit score hits 580. You can even qualify at 500 with 10% down—something most conventional loans won't allow.
The tradeoff is mortgage insurance. You pay 1.75% upfront plus annual premiums for the life of the loan if you put down less than 10%.
Debt-to-income ratios stretch to 50% with compensating factors. That flexibility helps Benicia buyers with student loans or car payments get approved.
Sellers can contribute up to 6% toward your closing costs. This reduces cash needed at closing significantly compared to conventional financing.
VA loans eliminate the down payment entirely for eligible veterans and active-duty service members. That's full financing on Benicia homes up to the conforming loan limit.
No monthly mortgage insurance exists with VA loans. You pay a one-time funding fee—typically 2.3% for first-time users—but it rolls into your loan amount.
Credit requirements are flexible but most lenders want 620 minimum. The VA itself sets no floor, leaving standards to individual lenders.
Disability ratings waive the funding fee completely. That saves thousands compared to both FHA and conventional options for qualified veterans.
Down payment separates these programs most dramatically. FHA needs 3.5% cash while VA requires nothing from eligible borrowers.
Monthly costs favor VA loans heavily. FHA charges permanent mortgage insurance while VA loans have none after the upfront funding fee.
Eligibility is the real divider. FHA accepts any qualified buyer while VA demands military service documentation and Certificate of Eligibility.
For a $650,000 Benicia purchase, FHA needs $22,750 down plus ongoing insurance. VA needs zero down but charges a $14,950 funding fee rolled into the loan.
If you qualify for a VA loan, use it. The zero down payment and eliminated mortgage insurance save you tens of thousands over the loan term.
Non-military buyers default to FHA when conventional financing won't work. The 3.5% down and flexible credit make homeownership possible despite tight qualifications.
Veterans with disability ratings should always choose VA—the waived funding fee makes it unbeatable. Even without disability, VA beats FHA on monthly costs.
Consider refinancing out of FHA once you hit 20% equity. That permanent mortgage insurance costs you roughly $400 monthly on a $650,000 Benicia home.
Yes, VA loan benefits restore after you sell and pay off the previous VA loan. You can reuse your entitlement multiple times throughout your life.
Only if you put down 10% or more—then it drops after 11 years. With 3.5% down, you pay insurance for the entire loan term.
FHA typically closes quicker because VA appraisals require additional property inspections. Budget 30-45 days for either loan type.
VA is stricter about property condition than FHA. Both have minimum standards, but VA often requires more repairs before closing.
Sellers sometimes worry about VA appraisals killing deals. Strong offers and quick closes matter more than loan type in Solano County.
VA already offers zero down, so most assistance programs won't stack. FHA works better with state or county down payment programs.