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in Cotati, CA
Cotati sits in Sonoma County where both FHA and USDA loans are available options. Most buyers don't realize USDA loans can work in suburban areas like this, not just rural farmland.
Both programs offer low down payment paths, but they serve different borrower profiles. Your income, location within Cotati, and cash reserves determine which one makes sense.
FHA loans require 3.5% down with credit scores as low as 580. You'll pay both upfront and monthly mortgage insurance for the life of the loan on most FHA mortgages.
These loans work anywhere in Cotati with no income caps. Debt-to-income ratios can stretch to 50% or higher with compensating factors, making FHA forgiving for buyers with existing debt.
FHA works well for buyers with past credit issues or limited savings. You can get approved two years after bankruptcy and qualify with higher debt loads than conventional loans allow.
USDA loans offer zero down payment financing in eligible Cotati zones. Not every address qualifies—you need to check the USDA eligibility map for your specific property location.
Income limits apply based on household size and county median income. Many middle-income earners in Sonoma County exceed USDA caps, which disqualifies them despite the property being in an approved area.
USDA charges an upfront guarantee fee and annual fee, but the monthly cost often runs lower than FHA insurance. Processing takes longer than FHA because USDA reviews each loan twice.
FHA works on any property in Cotati while USDA restricts you to designated rural-suburban zones. FHA has no income limits; USDA caps household income at specific thresholds for Sonoma County.
Down payment separates these programs most clearly. FHA needs 3.5% down, USDA needs zero, but USDA's geographic and income restrictions eliminate many buyers who would easily qualify for FHA.
Both charge mortgage insurance, but USDA's annual fee typically costs less. FHA insurance lasts for the loan's life unless you refinance; USDA insurance drops off when you reach 80% equity through amortization.
Choose USDA if you have zero cash for down payment, the property sits in an eligible zone, and your household income falls below county limits. Check eligibility before house hunting or you'll waste time on properties that won't qualify.
Go with FHA if you earn above USDA income caps, need to buy anywhere in Cotati, or want faster closing timelines. FHA also works better when you have some down payment saved and want to avoid income documentation complexities.
We run eligibility checks for both programs upfront. Many Cotati buyers assume they need FHA when USDA would save them thousands, or they waste weeks pursuing USDA only to find they're over the income limit.
No, only properties in USDA-designated eligible zones qualify. We check your address against the USDA map before starting your application.
USDA typically costs less monthly due to lower mortgage insurance. But you must qualify based on income and property location first.
FHA approves many condo projects. USDA generally requires single-family homes, though some townhomes may qualify depending on ownership structure.
Limits vary by household size and adjust annually. Most families earning above median county income won't qualify for USDA financing.
FHA closes faster, usually 30-40 days. USDA adds 10-15 days due to dual underwriting and stricter property appraisals.
Yes, you can refinance either loan to conventional to drop insurance. FHA insurance won't fall off without refinancing on most loans.