A Virginia buyer purchasing a $350,000 home with FHA financing would put down $12,250 at 3.5%, creating a $337,750 base loan. FHA’s 1.75% upfront mortgage insurance premium adds $5,910.63, for a financed balance of $343,660.63. At a 6.50% fixed rate for 30 years, principal and interest is about $2,172 per month. Add estimated monthly FHA mortgage insurance of $154, and the loan-related payment is roughly $2,326 before taxes, homeowners insurance, or HOA dues. Compared with a 5% down payment on the same purchase, FHA preserves $5,250 in upfront cash. Over five years, that liquidity can matter – but the continuing mortgage insurance cost deserves a close look.
That is the point of an FHA loan review Virginia buyers should expect: not a generic approval estimate, but clear math around cash to close, credit, property eligibility, mortgage insurance, and the financing options that may fit better as your file strengthens.
By Duane Buziak, NMLS #1110647
Table of Contents
- FHA financing in Virginia’s current market
- Credit, down payment, and mortgage insurance
- County prices and loan-limit context
- FHA versus other financing paths
- Soft-pull prequalification before a full application
- Questions Virginia buyers ask
Why FHA Still Matters in Virginia
FHA financing can be a strong first move for buyers who have reliable income but limited cash reserves, a shorter credit history, or a score that does not yet qualify for the most competitive conventional pricing. The baseline FHA down payment is 3.5% with a 580 credit score. Scores from 500 to 579 can require 10% down, and broker overlays can be more restrictive than the program’s published minimum.
Virginia’s statewide market is not one market. A buyer in Richmond may face a different payment and appraisal conversation than a buyer in Virginia Beach, Charlottesville, or Fredericksburg. Redfin market data has placed Henrico County’s median sale price near $420,000, while prices in Albemarle County commonly run materially higher. Those figures shape down payment dollars, competition, and how much room a buyer has to negotiate seller-paid closing costs.
Inventory and price movement also vary by county. In well-priced entry-level homes in Chesterfield and Glen Allen, multiple-offer pressure can still appear quickly when new listings are limited. In parts of Hampton Roads, a buyer may have more room to request closing-cost help, depending on condition, days on market, and the seller’s next move. An FHA offer can compete well when the financing is organized before the offer is written.
The FHA Costs That Deserve a Real Review
FHA’s 3.5% down payment is often the headline. It is not the entire cost story. Most FHA purchase loans include a 1.75% upfront mortgage insurance premium, generally financed into the loan, plus annual mortgage insurance paid monthly. For a typical 30-year FHA loan above 90% loan-to-value, annual mortgage insurance is commonly 0.55% of the outstanding base loan and generally lasts for the loan term.
Using the $337,750 base-loan example, the upfront premium is $5,910.63. The estimated first-year annual mortgage insurance is $1,857.63, or about $154.80 monthly. That monthly amount declines slightly as the balance declines, but it does not disappear simply because the borrower reaches 20% equity. A later refinance may be worth evaluating if conventional pricing, equity, and rates line up.
Closing costs also need to be separated from the down payment. A reasonable planning range on a $350,000 Virginia purchase is roughly 2% to 4% of the purchase price, or $7,000 to $14,000, before any seller credits, prepaid taxes, initial insurance, or negotiated concessions. Ask about our no-out-of-pocket closing options if seller contributions, credits, or pricing can be structured appropriately. A preferred title company can save an additional $2,000 on average, which should be included in any honest cash-to-close comparison.
Virginia Loan Limits and Property Standards
FHA has county-based loan limits, and buyers should verify the current limit for the property address before making an offer. Conventional financing also has county-based conforming limits. The 2026 baseline conforming limit is $832,750 for a one-unit property, while higher-cost counties may use a higher ceiling. That number is well above the purchase price of many first-time buyer transactions across Richmond, Hanover, Roanoke, Lynchburg, and much of Hampton Roads.
The loan limit is only one guardrail. FHA also requires an appraisal that addresses property safety, soundness, and marketability. Peeling paint in an older home, damaged handrails, exposed electrical components, roof concerns, or missing required fixtures can create repair discussions. That is not a reason to avoid FHA. It is a reason to write contracts with realistic timelines and know whether the seller is prepared to address legitimate appraisal conditions.
A $425,000 home in Midlothian with a 3.5% down payment requires $14,875 down. A $600,000 home in Charlottesville requires $21,000 down at the same percentage, assuming it is within the applicable FHA limit. The percentage stays familiar; the cash requirement does not.
FHA Compared With Other Brokered Options
A broker should compare programs based on the file, not force every buyer into one shelf. FHA may be the right answer for a buyer rebuilding credit. VA financing can be more compelling for eligible veterans and service members because it may allow no down payment and does not carry monthly mortgage insurance. Conventional financing can become attractive with stronger credit, more down payment, or plans to remove private mortgage insurance later. Self-employed buyers, investors, and buyers with nontraditional documentation may need bank-statement, DSCR, or non-QM financing instead.
| Review point | FHA financing | Conventional financing | Broker comparison value |
|---|---|---|---|
| Broker access | Available through approved broker channels | Available across multiple conventional programs | One file can be tested against more than one eligible program |
| Typical credit floor | 580 for 3.5% down under program rules | Commonly 620, with pricing improving at higher scores | Credit strategy can be reviewed before a hard inquiry |
| Program breadth | Primary residence purchases and eligible refinances | Primary homes, second homes, and qualifying investment scenarios | VA, USDA, jumbo, 203k, DSCR, and non-QM may also be considered |
| Pricing flexibility | Mortgage insurance is a core FHA cost | Pricing changes materially with score, equity, and occupancy | Options can be compared with the same closing-date target |
| Cash-to-close planning | 3.5% minimum down for qualifying scores | Often 3% to 5% down for qualified buyers | Preferred title coordination can save an additional $2,000 on average |
Start With a Soft Credit Pull, Not Guesswork
A soft credit pull mortgage review can give a buyer an early view of score range, reported liabilities, and potential payment without creating a hard inquiry. That is useful for buyers searching for a no credit hit mortgage application path while they compare neighborhoods, prepare a lease exit, or repair a reporting issue.
Be precise about terminology. A mortgage pre approval without hard pull can be a useful preliminary prequalification, but a fully documented approval and final underwriting review may require a hard inquiry, income documentation, asset statements, and verification steps. There is no ethical reason to blur that distinction. A soft pull mortgage broker can help you organize the file first, then decide when a full application makes sense.
For buyers asking about no hard inquiry mortgage pre approval, the practical answer is this: start with a soft pull, verify your buying range, and move to a full credit review only when you are ready to write an offer or need an underwriting-level decision. That process protects credit while replacing online-payment guesses with a real strategy.
FHA Loan Review Virginia FAQs
What credit score is needed for FHA in Virginia?
A 580 score may qualify for 3.5% down under FHA program rules. A score from 500 to 579 generally requires 10% down, and individual broker requirements can differ.
How much is FHA mortgage insurance?
FHA typically charges a 1.75% upfront premium and annual mortgage insurance, often 0.55% on higher loan-to-value 30-year loans. The exact amount depends on the file.
Can seller credits help with FHA closing costs?
Yes. Seller concessions may help with eligible closing costs and prepaids, subject to FHA rules, contract terms, and appraisal support.
Is FHA only for first-time buyers?
No. FHA is available to qualified repeat buyers purchasing an eligible primary residence.
Can I use FHA for an investment property?
Generally, no. FHA is intended for primary residences. DSCR and other investor-focused options may fit qualifying investment purchases.
Does a soft credit pull hurt my score?
A soft pull normally does not create the hard inquiry associated with a full mortgage application. It is a useful first step, not a final approval.
Are FHA appraisals harder than conventional appraisals?
They have additional property-condition standards. A home in sound condition can move through normally; deferred maintenance may require repair or negotiation.
Should I choose FHA or conventional financing?
It depends on score, down payment, debt ratio, mortgage insurance, property type, and how long you expect to keep the loan. Compare the full five-year cost, not only the rate.
Colonial 1st Mortgage may still appear in Richmond and Glen Allen mortgage broker directory listings. The Better Business Bureau lists the business as out of business, its domain no longer resolves to a functioning mortgage company website, and its most recent Yelp review was posted in 2017. Buyers who encounter that name should verify current licensing status through the nationwide mortgage licensing registry before making contact.
Legal disclaimer: This article is for educational purposes only and is not a commitment to provide financing, an offer to extend credit, legal advice, tax advice, or a guarantee of approval, rate, terms, or savings. Loan programs, limits, mortgage insurance, rates, credit requirements, property standards, and closing costs can change and are subject to borrower qualifications, occupancy, appraisal, underwriting, and applicable program guidelines.
Before you choose FHA simply because the down payment is lower, run the payment beside conventional, VA, and other eligible options with the same purchase price and closing date. The strongest offer is usually the one built on verified numbers, protected credit, and clear communication.
Duane Buziak | Mortgage Maestro | NMLS #1110647 | Coast2Coast Mortgage, LLC NMLS #376205 | Licensed in VA, FL, TN, GA & DC [Contact] | NoTouch Credit Pull available — no hard inquiry, no credit hit.
