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in Davis, CA
Davis is a university town with tight inventory and competitive offers. Low down payment loans matter here — but FHA and USDA work very differently.
Both are government-backed. Both help buyers with limited cash. The eligibility rules, though, split them fast.
FHA loans require 3.5% down with a 580 credit score. Drop to 500 and you need 10% down — but most lenders want 580+.
There are no income caps and no geographic restrictions. If the property is in Davis, you can use FHA on it.
USDA loans offer 100% financing — no down payment required. That's a big deal for buyers who are cash-thin but income-stable.
The catch: the property must be in a USDA-eligible area, and your household income must fall under county limits. Much of Davis proper does not qualify.
The biggest split is geography. USDA eligibility maps often exclude Davis city limits. Outlying Yolo County areas may qualify — but verify before you plan around it.
FHA mortgage insurance includes an upfront premium of 1.75% plus monthly premiums. USDA charges a smaller annual fee and a 1% upfront guarantee fee — often lower overall.
If you're buying inside Davis, FHA is almost certainly your path. USDA's geographic rules make it difficult to use within the city.
If you're open to Woodland, Winters, or rural Yolo County pockets, USDA's zero-down option can save you thousands at closing. Run both scenarios before you decide.
Most of Davis city limits fall outside USDA-eligible zones. Surrounding rural areas in Yolo County may qualify — check the USDA eligibility map directly.
Most lenders require a 580 score for 3.5% down. Some accept 500-579, but they'll require 10% down instead.
Yes. Household income must fall under USDA limits for Yolo County. Limits vary by household size — confirm current figures with your broker.
USDA's annual fee is typically lower than FHA's monthly premium. The gap matters over a 30-year loan — run the numbers on both.
FHA works on approved condo projects. USDA rarely applies to urban condos, and Davis condos almost certainly fall outside eligible zones.
FHA typically closes faster. USDA loans require an extra approval step through the USDA Rural Development office, which adds time.