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FHA Loans in Sebastopol
Sebastopol's West County location attracts buyers priced out of Healdsburg and Santa Rosa. FHA loans work well here for first-time buyers targeting single-family homes and condos.
Most Sebastopol properties fall within FHA's Sonoma County loan limit of $766,550 for single-family homes. That covers the majority of listings outside prime downtown blocks.
The 3.5% down payment requirement means you need $26,829 for a $766,550 purchase. Compare that to 20% conventional down, which would require $153,310.
You need a 580 credit score for 3.5% down. Scores between 500-579 require 10% down, but most lenders won't touch those files.
Debt-to-income can stretch to 50% with strong compensating factors. That's higher than conventional loans, which helps in expensive Sonoma County markets.
Two years of stable employment and a clean bankruptcy timeline matter more than perfect credit. Chapter 7 requires a two-year wait, Chapter 13 needs one year with payments current.
Not all lenders price FHA the same. We see rate spreads of 0.375% between our best and worst wholesale sources on identical borrower profiles.
Credit overlays matter more than published guidelines. Some lenders auto-decline 580-599 scores despite FHA allowing them. Others have property condition overlays that kill deals on older Sebastopol homes.
Condo approval is the biggest headache. The HOA must be FHA-approved, and many smaller Sebastopol complexes never bothered with certification.
FHA works best for Sebastopol buyers with strong income but limited savings. Tech workers relocating from the Bay often fit this profile perfectly.
Upfront mortgage insurance is 1.75% of the loan amount, financed into your loan. Monthly mortgage insurance runs 0.55%-0.85% annually depending on loan term and down payment.
That insurance never drops off on loans over 90% LTV with terms over 15 years. Run the math against conventional PMI, which cancels at 78% LTV.
We close most Sebastopol FHA loans in 21-25 days. Appraisal delays are rare here compared to rural Sonoma County areas.
Conventional loans beat FHA if you have 5%+ down and 680+ credit. Lower mortgage insurance and better investor property options make the difference.
VA loans crush FHA for eligible veterans. Zero down payment, no mortgage insurance, and better rates across the board.
USDA loans work in parts of Sonoma County but not Sebastopol proper. The city is too urban to qualify for USDA's rural development program.
Sebastopol's older housing stock creates appraisal issues. FHA requires working heat in all rooms and functioning handrails on stairs. Deferred maintenance kills deals.
Well and septic properties are common west of town. FHA allows them but requires water quality tests and septic inspections, adding 7-10 days to closing.
The city's cannabis-friendly reputation doesn't affect FHA eligibility, but lenders won't finance properties with active grows or commercial cannabis use.
Barlow district condos mostly lack FHA approval. That eliminates FHA for those mixed-use properties despite their popularity with first-time buyers.
$766,550 for single-family homes in Sonoma County. This covers most Sebastopol properties outside premium downtown locations.
FHA 203(k) rehab loans work for repairs, but the property must be habitable at purchase. Extensive renovations often make conventional renovation loans better.
Yes, but expect competition from conventional buyers. Sellers worry about appraisal conditions and repair requirements with FHA financing.
Expect 2-3% of purchase price. Sellers can contribute up to 6% toward your closing costs under FHA rules.
Only if the HOA is FHA-approved. Most smaller complexes lack approval, limiting your options significantly.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Mortgage programs that allow borrowers to qualify based on liquid assets rather than traditional employment income.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Asset-based short-term loans primarily used by real estate investors for property acquisition and renovation projects.
Mortgages that allow borrowers to pay only the interest for an initial period, resulting in lower monthly payments upfront.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Non-QM mortgages that use a CPA-prepared profit and loss statement to verify income for self-employed borrowers.
Home loans with interest rates that adjust periodically based on market conditions after an initial fixed-rate period.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.