Mortgage FAQs for Calexico Homebuyers - Your Questions Answered

The mortgage process usually takes 30-45 days from application to closing. Pre-approval can be completed in 1-3 business days with complete documentation.

Minimum credit scores vary by loan type. FHA loans may accept scores as low as 580, while conventional loans typically require 620 or higher. Rates vary by borrower profile.

Down payment requirements range from 0% for VA and USDA loans to 3% for conventional loans and 3.5% for FHA. Investment properties typically require 15-25% down.

Standard documents include two years of tax returns, recent pay stubs, bank statements, photo ID, and employment verification. Self-employed borrowers may need additional documentation.

Yes, self-employed buyers have multiple options including bank statement loans, profit and loss loans, and 1099 loans. These programs evaluate income differently than traditional mortgages.

FHA loans require lower down payments and credit scores but include mortgage insurance for the loan's life. Conventional loans offer more flexibility and can eliminate PMI at 20% equity.

First-time buyers may qualify for FHA loans with 3.5% down, conventional loans with just 3% down, or specialty programs. Some programs offer down payment assistance or reduced fees.

Closing costs typically range from 2-5% of the purchase price. They include lender fees, title insurance, escrow fees, appraisal costs, and prepaid items like property taxes and insurance.

Yes, foreign national loans are available for non-U.S. citizens. These programs use alternative documentation and may require larger down payments, typically 25-30%.

ARMs offer lower initial rates that adjust after a fixed period. They benefit buyers planning to sell or refinance within 5-7 years or those expecting income increases.

PMI is required on conventional loans with less than 20% down and protects the lender. FHA loans include upfront and monthly mortgage insurance regardless of down payment.

DSCR loans qualify investors based on rental property income rather than personal income. They work well for borrowers with multiple properties or those without traditional employment documentation.

Most loan programs allow gift funds from family members for down payments. Documentation includes a gift letter stating no repayment is expected and proof of the donor's funds.

Investment properties typically require 15-25% down for conventional financing. DSCR and investor loans may have similar requirements based on property cash flow and borrower experience.

Bank statement loans and asset depletion loans help borrowers who show reduced income on tax returns. These programs use bank deposits or assets to calculate qualifying income.

Bridge loans provide short-term financing when buying before selling your current home. They help avoid contingent offers and allow time to sell without rushing.

Yes, VA loans offer eligible veterans and service members 0% down payment options with no mortgage insurance. These loans feature competitive rates and flexible credit requirements.

ITIN loans serve borrowers using Individual Taxpayer Identification Numbers instead of Social Security numbers. These mortgages help non-citizens purchase homes with alternative documentation.

Required income varies by loan amount and debts. Most programs prefer total debt payments under 43-50% of gross monthly income, though some allow higher ratios.

Pre-qualification is an informal estimate based on basic information. Pre-approval involves document verification and credit review, providing a firm commitment amount for sellers.

Yes, FHA 203k loans and conventional renovation loans combine purchase and repair costs into one mortgage. Construction loans also finance extensive remodels or new builds.

Points are upfront fees that reduce your interest rate. One point equals 1% of the loan amount. They make sense if you plan to keep the loan long enough to recoup costs.

DTI compares monthly debt payments to gross income. Lower ratios improve approval odds and rates. Most programs accept DTI up to 43-50% depending on other qualifications.

Low appraisals require negotiation with sellers, additional down payment, or appealing the valuation with supporting data. Some buyers choose to walk away if contingencies allow.

Yes, waiting periods vary by loan type and circumstances. FHA may allow borrowers after 2-3 years, while conventional loans typically require 4-7 years from discharge or completion.

Jumbo loans exceed conforming loan limits set by federal agencies. They require stronger credit, larger down payments, and more reserves but offer financing for higher-priced properties.

Interest-only loans allow paying just interest for a set period, reducing initial payments. They suit buyers expecting income growth or planning to sell before the principal payment period begins.

A rate lock guarantees your interest rate for a specific period, typically 30-60 days. Lock when comfortable with the rate and confident you'll close within the timeframe.

Yes, student loans are included in debt-to-income calculations. Lenders use the payment shown on credit reports or calculate 1% of the balance for deferred loans.

A HELOC provides revolving credit secured by home equity. You draw funds as needed during a set period and pay interest only on the amount used.

Most lenders require 6-12 months of payment history before refinancing. Cash-out refinances typically need longer waiting periods, depending on the loan program used.

Fifteen-year mortgages offer lower interest rates and faster equity building but require higher monthly payments. They save significantly on total interest paid over the loan life.

Yes, lenders require proof of homeowners insurance before closing. Coverage must meet minimum requirements and list the lender as mortgagee. Proof is needed several days before closing.

Community mortgages offer flexible qualification standards for specific areas or borrowers. They may include reduced down payments, expanded income documentation options, or competitive rates.

Loan assumption is possible with some FHA and VA loans if the lender approves. You must qualify under current standards, and the seller remains liable unless released by the lender.

Asset depletion loans qualify borrowers using savings, investments, or retirement accounts rather than employment income. Lenders calculate monthly income by dividing total assets by the loan term.

Property taxes are typically included in monthly mortgage payments through an escrow account. The lender collects taxes monthly and pays them annually on your behalf.