CalHFA Conventional Loan · Updated July 2026
3% down. PMI that actually goes away. That's the conventional play.
CalHFA's conventional first mortgage asks for less down than FHA — 3% instead of 3.5% — and its mortgage insurance has an exit door. For buyers with solid credit, it's often the smarter long-term math. Here's how it works in 2026.
The CalHFA conventional loan in one sentence
A 30-year fixed conventional first mortgage with a 3% minimum down payment — which MyHome can cover at up to 3% — and private mortgage insurance you can remove once you reach 20% or more equity.
What is a CalHFA conventional loan?
CalHFA runs Fannie Mae HFA-style conventional programs — conventional mortgages with terms designed for housing finance agencies, delivered through CalHFA-approved lenders. Translation: you get a mainstream 30-year fixed loan, but with a lower down payment threshold than standard conventional financing and direct access to CalHFA's assistance stack.
The eligibility frame matches the rest of the CalHFA lineup: first-time buyer (no home ownership in the last 3 years), primary residence, homebuyer education certificate, and income at or below the CalHFA county limit — $259,000 in San Diego County for 2026.
3% down — and MyHome covers it
When paired with a CalHFA conventional first mortgage, MyHome provides up to 3% of the purchase price or appraised value (whichever is less) as a deferred junior loan — no monthly payment, no dollar cap. Since the conventional minimum down payment is also 3%, the assistance and the requirement line up:
| Purchase price | Conventional minimum down (3%) | MyHome provides (3%) | Down payment out of pocket |
|---|---|---|---|
| $550,000 condo (El Cajon, National City) | $16,500 | $16,500 | $0 |
| $700,000 townhome (Chula Vista, Vista) | $21,000 | $21,000 | $0 |
| $900,000 single-family (San Diego) | $27,000 | $27,000 | $0 |
Closing costs remain — typically a few percent of the price — but the CalPLUS + ZIP combination (a 0% deferred loan of roughly 2–3% of the first loan amount, which per CalHFA Bulletin 2025-04 now pairs with MyHome) and seller credits can absorb much of that. The programs hub walks through the full stack with dollar math.
The PMI advantage — why this page exists
Every low-down-payment loan carries mortgage insurance. The question is whether you can ever stop paying it.
| CalHFA Conventional (PMI) | CalHFA FHA (MIP) | |
|---|---|---|
| Upfront premium | None | ~1.75% of loan amount, financed |
| Monthly premium | Priced by credit score — cheaper with higher scores | Roughly flat pricing regardless of score |
| Can it be removed? | Yes — at 20%+ equity, per servicer requirements | Generally life of the loan at low down payments |
That third row is the one that compounds. In an appreciating market like San Diego, buyers can reach 20% equity through some combination of paydown and appreciation — and once PMI is removed, a conventional payment sheds a cost the FHA payment carries indefinitely (short of refinancing, which would also trigger MyHome repayment). No promises on timing — appreciation isn't guaranteed — but the option to remove insurance is structurally valuable, and FHA simply doesn't offer it at low down payments.
The credit-score hinge
PMI is priced by credit score, so this whole comparison hinges on yours. At roughly 700+, conventional PMI is usually cheap enough to beat FHA's insurance decisively. In the mid-600s, FHA's flat pricing often wins. This is exactly the side-by-side a CalHFA-approved lender should run for you — in writing, not hand-waving.
Conventional or FHA? The honest sorting
- Choose conventional if your credit is roughly 700+, you want mortgage insurance with an exit, and you'd rather avoid FHA's financed upfront premium.
- Choose FHA if your credit is in the mid-600s, you've had past credit events, or your debt-to-income needs FHA's flexibility. You also get 3.5% MyHome instead of 3% — a slightly bigger assistance layer.
- Either way, you must be under the income limit, complete homebuyer education, and buy through a CalHFA-approved lender.
- Undecided? Price both. The right answer is a comparison sheet, not a slogan — start here.
Where San Diego buyers use it
The conventional stack shines in the county's condo and townhome band — roughly $500,000 to $800,000 in Chula Vista, Oceanside, Vista, El Cajon and San Diego proper — where a 3% MyHome layer covers the full down payment and strong-credit buyers keep their monthly insurance cost lean. Our first-time buyer guide maps the neighborhoods in detail.
CalHFA conventional loan FAQ
How much down payment does the CalHFA conventional loan require?
A minimum of 3% of the purchase price. MyHome assistance provides up to 3% when paired with a CalHFA conventional first mortgage — with no dollar cap — so on most purchases the assistance covers the entire minimum down payment.
Can the PMI on a CalHFA conventional loan really be removed?
Yes. Private mortgage insurance on a conventional loan can be removed once you reach 20% or more equity, subject to your servicer's requirements. That's the key difference from FHA, where mortgage insurance at low down payments generally lasts for the life of the loan.
Who should choose the CalHFA conventional loan over CalHFA FHA?
Generally buyers with stronger credit — roughly 700 and up. PMI is priced by credit score, so higher scores get cheaper monthly insurance, and it disappears at 20% equity. Buyers in the mid-600s or with past credit events often find FHA's flat-priced insurance and forgiving underwriting the better fit.
Is there an income limit for the CalHFA conventional loan?
Yes. Your income must be at or below the CalHFA limit for your county — $259,000 in San Diego County and $210,000 in Riverside County for 2026. Other counties vary annually.
Can I stack MyHome and ZIP with a CalHFA conventional loan?
MyHome pairs with the CalHFA conventional first mortgage at up to 3% of the purchase price. The ZIP zero-interest closing-cost loan is available through CalPLUS first mortgages and, per CalHFA Bulletin 2025-04, must be used together with MyHome. A CalHFA-approved lender can price the combinations for your scenario.
Program details summarized from calhfa.ca.gov as of July 2026. CalHFA sets and may change all program terms; this page is educational and not a loan commitment.
See the FHA-vs-conventional math for your file.
Ten minutes gets you a side-by-side: down payment, insurance cost, and what you'd actually bring to closing under each program.