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in Fairfield, CA
Most Fairfield buyers focus on down payment when comparing these loans. That's a mistake. The real cost difference shows up in monthly payments and equity buildup over time.
Conventional loans demand higher credit and bigger down payments. FHA loans accept lower scores but charge mortgage insurance for life in most cases. The wrong choice costs you thousands.
Conventional loans require 620 minimum credit and 3% down for qualified buyers. You pay private mortgage insurance until you hit 20% equity, then it drops off automatically.
Rates run lower than FHA when your credit tops 680. You can buy anything from a Travis AFB area condo to a Green Valley single-family. No upfront funding fee either.
FHA accepts 580 credit scores with 3.5% down. You pay 1.75% upfront mortgage insurance plus 0.55-0.85% annual premium. That annual charge sticks around for the loan's life on most purchases.
Sellers in Fairfield know FHA buyers. Appraisers flag issues conventional loans ignore. But if your credit sits below 640, FHA often costs less monthly than conventional despite the insurance.
Credit score creates the biggest split. Above 700, conventional wins on rate and total cost. Between 580-680, FHA might offer lower payments despite permanent mortgage insurance.
Down payment feels similar but PMI rules change everything. Conventional lets you drop insurance after a few years of payments. FHA locks you into that premium unless you refinance to conventional later.
Pick FHA if your credit sits below 660 or you need the lower 3.5% down payment. Buyers targeting older Fairfield homes near downtown should check property condition first since FHA appraisers flag peeling paint and foundation cracks conventional lenders ignore.
Choose conventional when your score tops 680. You'll pay less monthly and build equity faster without permanent mortgage insurance. Plan to stay past five years and the savings get substantial as your PMI drops.
Conventional typically costs less upfront. FHA adds a 1.75% funding fee you can roll into the loan but still pay interest on for 30 years.
Yes, through refinancing once your credit improves and equity hits 20%. Most borrowers do this within five years to drop mortgage insurance.
Sellers accept both but conventional offers look stronger. FHA appraisals kill more deals due to property condition requirements.
740 or higher unlocks top-tier pricing. Every 20-point drop below that costs you in rate or fees.
Only if the complex is FHA-approved. Many smaller condo communities in Fairfield don't qualify, limiting your options.