California FHA Loans
For first-time homebuyers in California, FHA loans are becoming a very popular option. They only require a 3.5% down payment, and they’re available to buyers with less than perfect credit scores. In some cases, FICO scores as low as 620 have been accepted. Gifts from family members (related by blood or marriage) are permitted on FHA loans, too, and this is great if you’re a first-time buyer relying on financial assistance from relatives to get started.
If you’re putting down less than 80% of the purchase price, the lender will require you to pay a mortgage insurance premium (MIP). Also, the criteria for a California FHA states that you can’t have owned or had an interest in a property in the three years before applying.
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