A detailed breakdown of estimated monthly payments, upfront costs, inspections and closing considerations for FHA, Conventional and VA loans — prepared by Jerrod Butler, Realtor, to help buyers understand the full picture before making an offer.
These are estimates based on current market conditions. Actual rates, PMI, taxes and insurance will vary. Contact Jerrod for a personalized analysis specific to your situation.
Want a breakdown at a different purchase price? Schedule a free consult with Jerrod →
Not sure which loan type applies to you? Ask Jerrod — he'll point you in the right direction.
There are Down Payment Assistance (DPA) programs that offer up to 4% in down payment assistance on FHA loans — potentially covering your entire 3.5% down payment plus some closing costs. The trade-off is that the interest rate is typically about 0.5% higher than a standard FHA loan.
With your offer, Jerrod will request $5,000–$7,500 in seller concessions to cover lender fees and the initial funding of your escrow account for property taxes and homeowners insurance.
Budget approximately $350–$1,000 depending on how comprehensive you want to be.
Unlike FHA loans where MIP is fixed regardless of credit score, Conventional PMI varies significantly based on your credit score. Here is the estimated range:
| Credit Score | Annual PMI Rate | Monthly PMI | Total Monthly Payment |
|---|---|---|---|
| 620–639 | 1.10%–1.50% | $400–$546 | ≈ $3,509–$3,655/mo |
| 640–659 | 0.90%–1.20% | $327–$436 | ≈ $3,436–$3,545/mo |
| 660–679 | 0.70%–0.95% | $255–$346 | ≈ $3,364–$3,455/mo |
| 680–699 | 0.55%–0.80% | $200–$291 | ≈ $3,309–$3,400/mo |
| 700–719 | 0.40%–0.65% | $146–$236 | ≈ $3,254–$3,345/mo |
| 720+ | 0.25%–0.45% | $91–$164 | ≈ $3,200–$3,273/mo |
Jerrod will request $5,000–$7,500 in seller concessions to cover lender fees and the initial funding of your escrow account. On a Conventional loan there is no UFMIP to finance — so your cash needs at closing depend primarily on the success of seller concession negotiations.
The VA Funding Fee is a one-time fee paid to the VA — most borrowers choose to finance it into the loan rather than paying it at closing. The rate depends on your down payment and whether it is your first or subsequent use of the VA loan benefit.
| Down Payment | First Use | Fee Amount (1st Use) | Subsequent Use | Fee Amount (Sub. Use) |
|---|---|---|---|---|
| 0% down | 2.15% | $9,675 | 3.30% | $14,850 |
| 5% down | 1.50% | $6,413 | 1.50% | $6,413 |
| 10%+ down | 1.25% | $5,063 | 1.25% | $5,063 |
Jerrod will request $5,000–$7,500 in seller concessions to cover lender fees and escrow funding. On a VA loan, seller concessions can cover virtually all closing costs — making it possible to purchase with truly zero out of pocket beyond earnest money and inspections.
DTI is calculated by dividing your total monthly debt obligations — including your new mortgage payment (PITI) — by your gross monthly income. Lenders use two DTI ratios: Front-End DTI (housing costs only) and Back-End DTI (all monthly debts). Back-End DTI is the primary qualifier. For example: if your gross income is $8,000/month and total monthly debts including your new mortgage are $4,000, your back-end DTI is 50%.
| Loan Type | Standard Max DTI | Max with Compensating Factors | Notes |
|---|---|---|---|
| FHA | 43%–50% | Up to 56.9% | A good guideline is to budget for 50% DTI. Not every borrower qualifies at 56.9% — the TOTAL Scorecard evaluates the entire risk profile including credit score, reserves and payment history. |
| VA | 41% | Up to 60%+ | VA has no hard cap — the residual income test is equally important. Higher DTIs are approved regularly with strong residual income and compensating factors. |
| Conventional | 45% | Up to 50% | Fannie Mae DU / Freddie Mac LP automated underwriting. Higher DTIs require stronger compensating factors — higher credit score, larger down payment or significant reserves. |
Lenders don't look at any single factor in isolation. A strong credit score can offset a higher DTI. A large down payment can offset a lower credit score. Significant cash reserves can offset both. Here is how the combination typically plays out:
| Credit Score | Max DTI (FHA) | Max DTI (Conventional) | Compensating Factor Impact |
|---|---|---|---|
| 580–619 | ~43% | Not eligible (min 620) | Very limited flexibility. Strong reserves required. |
| 620–639 | ~50% | ~45% (high PMI) | Limited flexibility. Down payment and reserves help. |
| 640–679 | ~50–54% | ~45–47% | Moderate flexibility with compensating factors. |
| 680–719 | ~54–56% | ~47–50% | Good flexibility. TOTAL Scorecard often favorable. |
| 720+ | Up to 56.9% | Up to 50% | Maximum flexibility. Strong file across all factors. |
Every buyer's situation is different. Contact Jerrod for a personalized breakdown specific to your purchase price, credit score and loan type.
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