Last month, a family I met during a consultation was debating whether to set their down payment at 3.5% or to start with 20%. Hartsdale is a neighborhood in Westchester County that Korean families looking for good school districts near New York City have been consistently eyeing. The first thing to clarify for families facing this dilemma is the difference between conventional loans and FHA loans.

The average home value in Hartsdale is approximately $677,751 according to Zillow (as of 2026). However, the situation is different when looking at Westchester County as a whole during the same period. According to a local real estate market report, the median price for single-family homes reached $999,000 in February 2026, a 16.2% increase from the previous year. The reason for this gap is that Hartsdale, which has a mix of condos and co-ops, has a different price structure compared to the outer areas of the county where single-family homes are more prevalent. In simpler terms, even within the same name of Hartsdale, the required loan amounts can vary significantly depending on the type of property.

For first-time homebuyers with limited down payment capacity, an FHA loan seems to be a realistic option. If your credit score is 580 or higher, you can start with a 3.5% down payment, and if your score is between 500 and 579, you will need to put down 10%. However, it's important to know that if your down payment is less than 10%, mortgage insurance (MIP) will be required for the duration of the loan. On the other hand, if your credit score is above 680 and you have a 20% down payment ready, a conventional loan may be more advantageous. There is no PMI burden, and if your equity exceeds 20%, it can be canceled, making it less burdensome in the long run.

There is one more thing to note. Westchester County is classified as a high-cost area by the Federal Housing Finance Agency (FHFA). As of 2026, the conforming loan limit for this area is set at $1,209,750, which is significantly higher than the national baseline of $832,750 (as per FHFA's 2026 announcement). If the terminology is unfamiliar, think of it this way: if the loan amount does not exceed this limit, it is processed as a conventional loan; if it does exceed, it is classified as a jumbo loan, which requires a higher credit score and a larger down payment. For families looking for single-family homes around a million dollars in Hartsdale, the first step is to check if they fall within this limit.

Families moving from other states should also consider property tax burdens. Westchester is known for having relatively high property tax rates within New York State, so estimating monthly payments based on the property tax rates of their previous residence may result in underestimating actual costs. Families prioritizing school districts should refer to ratings from GreatSchools or Niche, but since school district boundaries change frequently, it's advisable to verify the assigned school for the address they are considering.

When compared to nearby Scarsdale, this trend becomes even clearer. Scarsdale has a strong reputation for its school district, resulting in significantly higher median prices for single-family homes than in Hartsdale. Therefore, with the same budget, Hartsdale offers more options within the conventional loan limit. For investors looking for rental income, Hartsdale's condos or townhouses may provide favorable rental yields compared to purchase prices, but it cannot be assumed that prices will continue to rise, so vacancy risks and management costs should also be considered.

For families with military service experience, VA loans are also worth considering. They can start without a down payment and have no PMI, but a funding fee of 1.25% to 3.3% of the loan amount applies. However, in areas like Hartsdale where there is a significant proportion of co-ops, it's important to check whether the building's board accepts VA or FHA loans on a case-by-case basis before making an offer.

Ultimately, in Hartsdale, whether to choose between FHA and conventional loans depends on the price range of the property, and as the budget increases, it's essential to also consider the high-cost area limits and jumbo loan options. Since tax and loan conditions can vary by state and county, it's advisable to consult with a professional before finalizing any contracts. This article does not constitute investment or legal advice, and it is recommended to consult with a loan officer or real estate expert before proceeding with any contracts.