Mortgage FAQs for Colusa Homebuyers – Local Expertise from SRK CAPITAL

Conventional and FHA loans handle most primary residences under $500k. Self-employed borrowers typically need bank statement or 1099 programs instead of traditional W-2 income verification.

FHA requires 3.5% down, conventional loans start at 3% for first-time buyers. Investment properties need 15-25% depending on the loan program and your credit profile.

Yes, but most residential mortgages exclude working farms with significant acreage. USDA loans cover rural homes on larger parcels if you're not generating farm income from the land.

FHA accepts 580 minimum, conventional loans prefer 620 or higher. Scores below 620 limit your options and increase costs significantly through higher rates and fees.

Standard purchases close in 30-45 days from accepted offer. Rural appraisals can add 1-2 weeks since fewer appraisers cover Colusa County compared to metro areas.

No, borrowers with 620+ credit get approved regularly. Lower scores require larger down payments and may limit you to FHA financing instead of conventional options.

W-2 earners provide two years of tax returns and recent pay stubs. Self-employed borrowers can use bank statements, 1099 forms, or P&L statements depending on the loan program.

California offers down payment assistance through CalHFA, but income limits apply. Conventional loans with 3% down often cost less than assisted programs once you factor in program fees.

No, investment properties require 15-25% down minimum. DSCR loans use rental income for qualification instead of personal income, which works well for investors with multiple properties.

Budget 2-5% of purchase price for closing costs including lender fees, title, escrow, and appraisal. Rates vary by lender and loan type, so compare total costs not just interest rates.

Conventional loans offer the lowest rates for qualified borrowers. FHA rates run slightly higher, while bank statement and investor loans add 0.5-2% due to increased lender risk.

FHA makes sense if you have under 10% down or credit below 680. Conventional loans eliminate mortgage insurance faster and cost less long-term for borrowers with stronger profiles.

Yes, bank statement loans use 12-24 months of business deposits instead of tax returns. This works well when tax write-offs reduce your reported income below actual cash flow.

DSCR loans qualify you based on rental income from the property, not personal income. Investors use these to finance multiple properties without income documentation or debt-to-income limits.

Yes, if you put down less than 20% on a conventional loan. FHA requires mortgage insurance for the loan's life unless you refinance, while conventional PMI drops off at 78% loan-to-value.

Yes, VA loans offer zero down payment for qualified veterans and active military. These work for primary residences only, not investment properties or second homes in Colusa County.

Points let you prepay interest to lower your rate permanently. This makes sense if you'll keep the loan 5+ years, which is less common in smaller markets like Colusa.

Appraisals take longer due to fewer comparable sales and limited appraiser availability. USDA loans offer zero down for eligible rural properties if you meet income requirements.

FHA 203k and conventional renovation loans cover purchase plus repairs in one mortgage. Most older Colusa homes need updates, so these programs avoid double-financing with construction loans.

Most programs accept up to 50% DTI including your new mortgage payment. Higher ratios require compensating factors like larger down payments or significant cash reserves.

ARMs offer lower initial rates for 5, 7, or 10 years before adjusting. These make sense if you'll sell or refinance before adjustment, which is common for starter homes.

1099 loans use your gross income from tax forms without typical business expense deductions. These qualify you faster than full tax return review for independent contractors.

Yes, ITIN loans don't require Social Security numbers or US citizenship. You'll need larger down payments and pay higher rates than conventional financing.

Portfolio ARMs are adjustable loans held by individual lenders with flexible underwriting. These help borrowers with complex income or credit situations that don't fit agency guidelines.

Get pre-approved with full documentation and credit review before making offers. Pre-qualification without verification means nothing to sellers in competitive situations.

Lenders approve up to 50% debt-to-income ratio, but that's often too tight. Keep housing costs under 30% of gross income to avoid financial stress from unexpected repairs or income changes.

Yes, immediate family can gift funds for down payment and closing costs. You'll need a gift letter stating the money doesn't require repayment and documentation showing the transfer.

You'll need to renegotiate the price, bring extra cash, or cancel the deal. Low appraisals happen in rural markets when comparable sales are limited or outdated.

Properties in FEMA flood zones near the Sacramento River require flood insurance. Your lender will order a flood certification during underwriting to determine if coverage is mandatory.

Yes, FHA and conventional loans finance 2-4 unit properties if you live in one unit. Rental income from other units helps you qualify for a larger loan amount.

We shop 200+ lenders to find programs big banks don't offer like bank statement and DSCR loans. This matters in Colusa where self-employed and agricultural income is common.

Bridge loans provide short-term financing using your current home's equity to buy before selling. These cost more than traditional mortgages but eliminate sale contingencies in competitive markets.

Lock when you're 30-45 days from closing and comfortable with the rate. Rates vary by borrower profile and market conditions, so timing the absolute bottom is impossible.

Request cancellation at 80% loan-to-value through payments or appreciation. You'll need a new appraisal to prove the value increase, which costs $500-600 in Colusa County.

Pre-approval reviews income and credit before you shop. Final approval happens after appraisal and full underwriting review, which can uncover issues that weren't initially apparent.