# Government-Backed Loan Programs

## FHA (Federal Housing Administration)

- **Administered by**: HUD via FHA-approved lenders
- **Down payment**: 3.5% (credit score ≥ 580) or 10% (500–579)
- **Credit score**: 580+ for max financing; 500–579 with 10% down
- **MIP (Mortgage Insurance Premium)**:
  - Upfront: 1.75% of loan amount (can be financed)
  - Annual: 0.15%–0.75% depending on LTV, term, and amount (paid monthly)
  - Duration: Life of loan for most borrowers (≤10% down); 11 years if >10% down
- **Loan limits**: Vary by county; check hud.gov
- **Best for**: First-time buyers, lower credit scores, smaller down payments
- **Key restriction**: Primary residence only; no investment properties

## VA (Department of Veterans Affairs)

- **Eligibility**: Active duty, veterans, reservists, National Guard, surviving spouses
- **Down payment**: 0% (no down payment required)
- **Credit score**: No VA-mandated minimum; lenders typically require 620+
- **Funding fee**:
  - First use: 2.15% (0% down), 1.5% (5%+ down), 1.25% (10%+ down)
  - Subsequent use: 3.3% (0% down)
  - Exempt: Veterans with service-connected disability, Purple Heart recipients
  - Can be financed into the loan
- **No PMI**: No monthly mortgage insurance
- **Loan limits**: None for borrowers with full entitlement (post-2020)
- **Best for**: Eligible military members wanting zero-down, no-PMI financing

## USDA (US Department of Agriculture)

- **Administered by**: USDA Rural Development
- **Eligibility**: Property must be in eligible rural/suburban area; income limits apply
- **Down payment**: 0%
- **Credit score**: 640+ for automated approval; manual underwriting possible below
- **Guarantee fee**:
  - Upfront: 1.0% of loan amount
  - Annual: 0.35% of remaining balance (paid monthly)
- **Income limits**: Generally 115% of area median income; varies by county and household size
- **Best for**: Moderate-income buyers in eligible rural/suburban areas
- **Key restriction**: Primary residence only; property location must qualify

## Program Comparison Summary

| Feature | FHA | VA | USDA |
|---------|-----|-----|------|
| Min down | 3.5% | 0% | 0% |
| Insurance/fee | MIP (life) | Funding fee (one-time) | Guarantee fee |
| Monthly insurance | Yes | No | Yes (0.35%) |
| Credit floor | 580 | ~620 (lender) | 640 |
| Income limits | No | No | Yes |
| Location limits | No | No | Yes (rural) |
| Occupancy | Primary | Primary | Primary |