A client looking for a home in Centreville recently asked a question. With a credit score in the low 600s and about $30,000 prepared for a down payment, they were unsure whether to go with an FHA loan or a conventional loan. This single question reflects much of the reality of the mortgage market in Centreville.

According to Zillow data, the median home price index in Centreville is around $524,845, which is a 9.7% increase from a year ago (as of 2026). This number is significant. It indicates that the prices comfortably fall within the national conforming loan limit of $832,750 for 2026, meaning that jumbo loans are not a consideration in this area. In fact, most offers coming out of Centreville fall into one of the two categories: FHA or conventional loans.

For FHA loans, if your credit score is 580 or higher, you can enter with a down payment of 3.5%. If your score is between 500 and 579, a 10% down payment is required. However, mortgage insurance premiums apply; if the down payment is less than 10%, it must be maintained throughout the loan term, and if it is over 10%, it can be canceled after 11 years. For the client with a credit score in the low 600s, the FHA option presents a lower barrier to entry.

Conventional loans recommend a credit score of 620 or higher, and rates improve significantly if the score exceeds 680. The down payment can range from 3% to 20%, and while PMI applies for down payments under 20%, it can be canceled once the home equity exceeds 20%, making it more flexible than FHA's mortgage insurance premiums. However, if the credit score is still below 680, the advantages in rates compared to FHA may not be substantial.

For investors looking to purchase for rental income, the calculations differ slightly. Even with a conventional loan, investment properties often require a higher down payment percentage than owner-occupied homes, and rates are typically slightly higher as well. Instead of aggressively increasing leverage based solely on rental income, it is safer to conservatively calculate cash flow by considering variables like vacancy periods and repair costs. When expecting capital gains, it is also better to monitor local development plans and changes in school districts rather than assuming prices will always rise.

If someone has just moved from Korea and has a short credit history in the U.S., the FHA option is relatively more accessible. Even with a short credit history, some lenders will allow alternative assessments based on rental payments or utility bill payment records, so it is helpful to inquire with multiple institutions to compare conditions. In the initial settling phase, building credit history may be a more critical factor than the type of loan.

Centreville is located in Fairfax County, which is designated as a high-cost area by the FHFA, so the core loan limit will rise to $1,249,125 in 2026. However, the median price in Centreville is still well below this limit, making the choice between FHA and conventional loans a more realistic consideration for most actual buyers than jumbo loans. If targeting properties with large lots or those that have been remodeled, the situation may differ.

As a region with a significant Korean community, school districts are also a variable in purchase decisions. While referencing ratings from GreatSchools or Niche can be helpful, school district boundaries change frequently, so it is essential to verify the assigned school for the specific address before signing a contract.

Families moving from other states should also be aware that Virginia's property tax and insurance structures may differ from their previous residence. If they only calculate the down payment and make assumptions about monthly payments, they may find their budget off after closing. Families moving from states with no or low property taxes may be surprised when they receive their first property tax bill in Virginia, so it is wise to get an estimate from the lender on how much will accumulate in escrow each month.

Ultimately, in Centreville, the credit score and the amount of prepared down payment will determine which option, FHA or conventional loan, is more advantageous. If credit is still low, starting with an FHA loan and later aiming for refinancing is one approach, while securing a score above 680 may make the PMI cancellation conditions of a conventional loan a more favorable long-term choice. This article does not constitute investment or legal advice, and it is recommended to consult with lenders and professionals before finalizing any contracts.