FHA vs Conventional vs VA: Which Loan Is Right in Palm Beach County?
For most first-time buyers in Palm Beach County, the choice comes down to credit and cash: FHA allows 3.5% down with a credit score of 580 or higher, conventional loans start around 3% down but typically want a 620-plus score and reward stronger credit with lower costs, and VA loans allow 0% down with no monthly mortgage insurance for eligible veterans, active-duty service members, and surviving spouses. The wrinkle that is specific to this county is loan size: the 2026 FHA limit for a one-unit property in Palm Beach County is $667,000, while the conforming (conventional) baseline limit is $832,750. Above the FHA ceiling, conventional financing simply buys more house here.
The three programs, side by side
| FHA | Conventional (conforming) | VA | |
|---|---|---|---|
| Minimum down payment | 3.5% with a 580+ score; 10% with 500-579 | Typically 3% for qualified first-time buyers | 0% for eligible borrowers |
| Typical minimum credit score | 580 | 620 | Set by lender; no statutory minimum |
| Mortgage insurance | Upfront MIP plus annual MIP | Private mortgage insurance (PMI) under 20% down, removable | None |
| One-unit loan limit (2026) | $667,000 in Palm Beach County | $832,750 conforming baseline | No loan cap; entitlement rules apply |
| One-time fee | Upfront MIP, financeable | None | VA funding fee, financeable, waived for some disabled veterans |
| Who it fits | Thinner credit files, smaller down payments | Stronger credit, wanting to shed mortgage insurance later | Anyone with VA eligibility - almost always the best option |
Sources: HUD 2026 FHA loan limits; FHFA 2026 conforming loan limits. The 2026 FHA national floor is $541,287 (65% of the conforming baseline) and the ceiling is $1,249,125 (150%). Palm Beach County's $667,000 limit sits between them - above the Florida baseline that applies to most counties in the state, and below the conforming baseline.
What the county limit means in practice
At FHA's minimum 3.5% down, a $667,000 base loan corresponds to a purchase price near $691,000 before closing costs, seller credits, reserves, taxes, insurance, HOA dues, and any lender overlays. Palm Beach County's median single-family sale price was $700,000 in June 2026, and the median condo/townhouse price was $325,000, per BeachesMLS / Florida Realtors statistics - the data behind our Palm Beach County market report.
Read that carefully: at the median single-family price, an FHA buyer is right at the edge of the program in this county, while the condo and townhouse market sits comfortably inside it. That is one reason so many first-time purchases here start in condos, townhouses, and villas. It is also why the association's financing eligibility - reserves, investor concentration, milestone inspection status - matters to a first-time buyer, not just to the board.
FHA: flexibility, at a cost
FHA exists to widen access. A 580 score with 3.5% down is a genuinely low bar, and FHA is more forgiving on debt-to-income ratios and past credit events than conventional underwriting.
The trade-off is mortgage insurance. FHA charges an upfront mortgage insurance premium (financeable into the loan) plus an annual premium collected monthly. On most modern FHA loans with the minimum down payment, that annual premium stays for the life of the loan - the only way off it is to refinance out of FHA. That is a permanent monthly cost you should model before you commit, especially if your credit is likely to improve within a couple of years.
FHA also applies property standards. Appraisers flag health and safety issues, and in South Florida that frequently means roof condition and remaining roof life. On a 1970s or 1980s home, roof age can decide whether the loan closes at all.
Conventional: better math if your credit cooperates
Conventional conforming loans start around 3% down for qualified first-time buyers. Private mortgage insurance applies below 20% down, but unlike FHA's annual premium it is priced off your credit score and it goes away - by request as you approach 20% equity, or automatically at 78% of the original value under federal rules.
If your score is comfortably above 700, conventional is usually the lower lifetime cost. The higher conforming limit ($832,750 for one unit in 2026) also keeps more of the Palm Beach County market in reach without moving to jumbo financing. Condo buyers should know that conventional condo review is stricter than many expect - the building has to qualify, not just you.
VA: use it if you have it
If you are an eligible veteran, active-duty service member, or surviving spouse, VA financing is almost always the strongest option available: no down payment required, no monthly mortgage insurance, and competitive rates. There is a one-time funding fee, which can be financed and which is waived for certain veterans receiving disability compensation. There is no VA loan cap for borrowers with full entitlement - what limits you is what a lender will approve based on income and credit.
The most common mistake we see is eligible buyers not asking about VA because they assume the process is slow. It is not, with a lender that closes VA loans regularly.
What to do before you shop
- Get pre-approved, not pre-qualified. In a market where nearly half of county purchases closed in cash in June 2026, a financed offer needs credible documentation attached.
- Price all three programs with the same lender and compare total monthly payment plus five-year cost, not just the rate.
- Model insurance and taxes honestly. In Florida these are often the difference between programs feeling affordable and not. See our guide to what you need for a down payment in Palm Beach County for the full cash-to-close picture.
- Ask about the property type early. Condo and HOA-governed purchases add association review on top of loan approval.
- Verify program details at application. Loan limits, premiums, and fees change annually, and lender overlays vary.
Buying your first home in Palm Beach County
Gia Freer is a licensed Florida broker (license CQ1064615) with more than 20 years in South Florida; our team has closed 739 homes and $197,641,802 in volume. We will tell you plainly which price band, property type, and loan program actually fit your situation, including whether the smarter move is to wait a few months and improve your file. Start with our buyer resources or the relocation guide to South Florida if you are moving in from out of state, then call 561-395-8418.
This article is general real estate information, not lending, legal, or tax advice. Loan program terms are set by HUD, FHFA, the VA, and individual lenders, and change over time. Confirm current figures with a licensed mortgage professional.
Loan Program Questions and Answers
What is the FHA loan limit in Palm Beach County for 2026?
$667,000 for a one-unit property, per HUD's 2026 FHA loan limits, effective for case numbers assigned on or after January 1, 2026. The two-unit limit is $853,900, three-unit is $1,032,150, and four-unit is $1,282,700.
What credit score do I need for an FHA loan?
580 to qualify for the 3.5% minimum down payment. Borrowers with scores of 500 to 579 may still qualify with at least 10% down. Individual lenders can impose higher minimums than FHA requires.
Is FHA or conventional better for a first-time buyer in Florida?
If your credit score is under about 620 or your down payment is very small, FHA is usually the accessible option. If your score is above roughly 700, conventional typically costs less over time because private mortgage insurance is cheaper for strong credit and can be removed once you reach 20% equity, while FHA's annual premium generally stays for the life of the loan.
Does a VA loan really require no down payment?
Yes - eligible borrowers with full entitlement can finance 100% of the purchase price with no monthly mortgage insurance. A one-time VA funding fee applies and can be financed; it is waived for certain veterans receiving VA disability compensation.
What is the 2026 conforming loan limit?
The one-unit conforming baseline limit set by FHFA for 2026 is $832,750. Palm Beach County uses the baseline conforming limit, which is higher than the county's $667,000 FHA limit.
Can I use FHA financing to buy a condo in Palm Beach County?
Only if the project is FHA-approved or qualifies through single-unit approval. Association reserves, investor concentration, litigation, and milestone inspection status all affect eligibility, so confirm the building's status before writing an offer.