# Huge Opportunities for Home Buyers

By Tai Boutell (@taiboutell) · Published 2026-10-08

Canonical: https://voce.com/@taiboutell/huge-opportunities-home-buyers-nytcii

---

The 30-year fixed-rate mortgage gets all the attention, but it's rarely the best first move for a California buyer in 2026. The real affordability lever is choosing between an **FHA loan** and a **conventional loan**, then stacking a state down payment program on top to shrink what you owe at closing. FHA loans let you in with a 3.5% down payment and a credit score as low as 580, while conventional loans reward stronger credit with mortgage insurance that eventually goes away ([Altitude Home Loans](https://altitudehomeloans.com/fha-vs-conventional-loans-which-is-right-for-you-in-2026)).

This guide walks you through the two loan paths side by side, then shows how CalHFA's MyHome program — the always-available state down payment assistance option — pairs with either loan to make a first purchase realistic in a high-price, high-rate market.

## Why a conventional loan might cost you less long-term

A **conventional loan** is not government-insured; it follows guidelines set by Fannie Mae and Freddie Mac, the two agencies that buy most home loans. First-time buyers can put down as little as **3%** through programs like HomeReady and Home Possible, while standard conventional loans typically ask for 5% down ([Altitude Home Loans](https://altitudehomeloans.com/fha-vs-conventional-loans-which-is-right-for-you-in-2026)).

The bar on credit is higher: most lenders want a minimum score of **620**, though 640 or above is preferred and buyers above 740 get the most favorable rates. That higher standard pays off. Conventional private mortgage insurance (PMI) runs roughly **0.25% to 2%** of the loan annually, and unlike FHA's lifelong premium, it **automatically cancels once you reach 20% equity** in the home through payments or appreciation ([Altitude Home Loans](https://altitudehomeloans.com/fha-vs-conventional-loans-which-is-right-for-you-in-2026)).

So the real question is what your credit and down payment allow. If your score is below 680 or you can only manage 3.5% down, FHA gets you in the door. If your score is 720 or higher and you can put 5% down, a conventional loan usually wins because you can shed PMI later — a common strategy is starting with FHA to buy, then refinancing into conventional once you've built 20% equity and improved your credit ([Altitude Home Loans](https://altitudehomeloans.com/fha-vs-conventional-loans-which-is-right-for-you-in-2026)).

## MyHome: California's steady down payment option

When you've picked a loan type, the next lever is down payment assistance — and CalHFA's **MyHome Assistance Program** is the dependable California option that runs year-round. MyHome gives first-time buyers a **deferred-payment junior loan of up to 3.5% of the purchase price** to cover the down payment, and because it's deferred, there's no monthly payment on it ([HomePlus Mortgage](https://homeplusmortgage.com/california-down-payment-assistance-programs-2026)).

Eligibility is broad. MyHome is open to first-time buyers under the standard three-year rule, meaning you haven't owned a home in the past three years. You'll need a minimum credit score of **660**, and the assistance works with single-family homes, condos, and manufactured homes ([HomePlus Mortgage](https://homeplusmortgage.com/california-down-payment-assistance-programs-2026)).

The loan comes due only when you sell, refinance, or pay off the first mortgage. Crucially, it's a deferred-payment junior loan, not a shared appreciation loan — the state doesn't claim a slice of your home's appreciation when you sell, unlike some other programs. Pair MyHome with an FHA loan (3.5% down) or a low-down-payment conventional loan (3% down), and you can effectively cover the entire down payment with state funds, freeing your cash for closing costs and reserves.