Question 1

Can I switch from FHA to conventional later?

Accepted Answer

Yes. Once you have 20% equity and stronger credit, refinancing into conventional removes the lifetime MIP. Many Petaluma buyers do exactly this.

Question 2

Which loan has a lower down payment?

Accepted Answer

Both go as low as 3-3.5%. Conventional 3% requires stronger credit; FHA 3.5% is accessible at 580.

Question 3

Does FHA have loan limits in Sonoma County?

Accepted Answer

Yes. FHA caps borrowing in Sonoma County. If the purchase price exceeds that limit, conventional is your only conforming option.

Question 4

Which loan is easier to qualify for?

Accepted Answer

FHA. It allows lower credit scores and higher debt-to-income ratios. Lenders have more flexibility with FHA-backed files.

Question 5

Is the FHA rate lower than conventional?

Accepted Answer

Not always. FHA rates are often similar, but add MIP and the true cost runs higher. Rates vary by borrower profile and market conditions.

Question 6

Can I use FHA on a multi-unit property in Petaluma?

Accepted Answer

Yes, up to a 4-unit property — as long as you occupy one unit. Conventional allows this too, with different reserve requirements.

Conventional vs FHA Loans in Petaluma, CA