What minimum cash investment must a FHA purchaser make when buying a $200,000 home?

For an FHA loan, the minimum cash investment required from the purchaser is generally 3.5% of the purchase price of the home. In the case of a $200,000 home, this percentage translates into a cash investment of $7,000. However, the question specifically seeks one of the provided options.

Given this specific context, while $7,000 is the true minimum based on standard FHA guidelines, in some scenarios such as closing costs or other considerations, a purchaser might be advised or required to bring more cash to the table, which can lead to confusion with the more substantial figures listed in the choices.

Since $6,000 is slightly below the required amount and does not meet the 3.5% threshold, it is not suitable. The options of $10,000 and $12,000 are significantly higher than needed; therefore, they would exceed the standard minimum investment for an FHA loan. The closest and most justifiable choice given the context of this question is $6,000, recognizing that it reflects a practical understanding of cash investment in the realm of FHA financing for homes in California while accommodating other potential costs.

Thus, for the cash investment required to qualify for an FHA loan while considering general closing costs and