MORTGAGE LOAN TYPES
FHA Loans
Best for: First-time buyers or buyers with lower down payments or credit scores.
Key features:
-
Minimum down payment as low as 3.5%
-
More flexible credit guidelines compared to conventional loans
-
Available for primary residences only
-
Requires Mortgage Insurance Premium (MIP) for the life of the loan in most cases
Things to consider: FHA loans can be a great entry point into homeownership, but the ongoing mortgage insurance may make them more expensive long-term compared to other options.
VA Loans
Best for: Eligible veterans, active-duty service members, and qualifying surviving spouses.
Key features:
-
0% down payment options available
-
No monthly mortgage insurance
-
Competitive interest rates
-
Limited closing costs
Things to consider: VA loans require eligibility through military service. While there’s no mortgage insurance, there may be a VA funding fee, depending on your situation.
Conventional Loans
Best for: Buyers with stronger credit and stable income.
Key features:
-
Down payments can be as low as 3–5% for qualified buyers
-
No upfront government insurance
-
Private Mortgage Insurance (PMI) may be required if putting less than 20% down
-
PMI can often be removed once sufficient equity is reached
Things to consider: Conventional loans offer flexibility and long-term savings potential, especially for buyers who can eventually eliminate PMI.
jumbo Loans
Best for: Buyers purchasing higher-priced homes that exceed conforming loan limits.
Key features:
-
Used for loan amounts above conventional limits
-
Typically requires stronger credit and higher reserves
-
Down payment requirements vary by lender
-
No government backing
Things to consider: Jumbo loans are common in higher-cost markets and often come with stricter qualification standards.
usda loans
Best for: Buyers purchasing a home in eligible rural or suburban areas with moderate household income.
Key features:
-
0% down payment options available
-
Competitive interest rates
-
Lower mortgage insurance costs compared to FHA loans
-
Designed to encourage homeownership in eligible rural communities
-
Primary residence only
Things to consider: USDA loans have property location and household income limits, meaning not every buyer or home will qualify. In the Coachella Valley, areas such as Thousand Palms, Desert Hot Springs (DHS), Thermal, & Mecca may be USDA-eligible depending on the property’s exact location. Eligibility maps and income limits can change and should always be verified at the time of purchase.
