Cerritos Mortgage FAQ: Your Questions Answered by Local Brokers

FHA loans start at 580, but 620 gets you conventional rates. Jumbo loans typically need 700+ for best pricing in this price range.

FHA requires 3.5%, conventional starts at 3%. Jumbo loans usually need 10-20% depending on loan amount and credit profile.

Standard purchases close in 30-35 days. Cash-out refinances take 25-30 days once we submit to underwriting.

Many Cerritos homes exceed the $806,500 conforming limit. We check conforming eligibility first since rates are better when you qualify.

W-2 earners need two years tax returns, two recent paystubs, two months bank statements. Self-employed borrowers have alternative doc options through our wholesale channels.

Yes. Bank statement loans use 12-24 months deposits instead of tax returns. We also offer 1099 loans and P&L programs for business owners.

FHA allows lower credit and smaller down payments but charges mortgage insurance for life. Conventional drops PMI at 20% equity and offers better rates above 680 credit.

PMI costs 0.3-1.5% annually on conventional loans under 20% down. FHA charges 0.55% annual plus 1.75% upfront, and it never drops off.

Expect 2-3% of loan amount for lender fees, title, escrow, and appraisal. LA County transfer taxes add roughly 0.11% of purchase price.

One point costs 1% of the loan and drops your rate 0.25%. Break-even is usually 4-5 years, so only pay points if you're staying long-term.

Yes, if you're military or veteran. VA loans offer zero down and no PMI, which saves significantly over 30 years.

DSCR loans qualify based on rental income, not your W-2. Investors buying Cerritos rental properties use these when personal income won't support another mortgage.

Yes. ITIN borrowers can qualify with tax ID numbers instead of Social Security. We also have foreign national programs for international buyers.

We compare rates across 200+ lenders instead of one bank's products. That competition saves borrowers money and opens more approval paths.

ARMs offer lower initial rates fixed for 5, 7, or 10 years, then adjust annually. They make sense if you'll sell or refinance before adjustment.

Yes. Lenders count 0.5-1% of the balance as monthly payment if loans are deferred. IBR payments use the actual IBR amount in debt calculations.

Asset depletion divides investment accounts by 360 months to create income. Retirees or high-net-worth buyers with low tax returns use this program.

Lenders approve up to 50% debt-to-income ratio. Your housing payment including taxes and insurance shouldn't exceed 43% of gross monthly income for best rates.

Portfolio ARMs stay with one lender instead of selling to Fannie Mae. They offer more flexible qualifying but usually higher rates and fees.

Only if you're maxing purchase power or investing the payment difference. Most buyers build equity faster with standard amortization in appreciating LA County markets.

Lenders analyze 12 or 24 months of business deposits and apply 50-75% as income. This works better than tax returns for owners who write off expenses.

Yes. Investment loans need 15-25% down and rates run 0.5-0.75% higher. DSCR programs qualify on property income instead of yours.

Bridge loans let you buy before selling your current home. They're short-term and expensive but solve timing gaps in competitive markets.

HELOCs give you a credit line secured by home equity. You draw as needed and pay interest only on what you use.

HELOCs are revolving credit with variable rates. Home equity loans give you a lump sum with fixed rates and set payments.

Yes. Construction loans fund in draws as work completes, then convert to permanent financing. You need 20-25% down and detailed builder contracts.

Borrowers 62+ can convert equity to cash without monthly payments. The loan gets repaid when you sell or pass away.

FHA allows 2 years after discharge, conventional needs 4 years. We've closed loans 2 years out with strong credit rebuild and explanation letters.

Pre-qualified is an estimate based on what you tell us. Pre-approved means we pulled credit and reviewed documents—sellers take you seriously.

Locks hold your rate for 30-60 days while we close. Lock when you're in contract and comfortable with the rate and market direction.

Some lenders offer float-down options for a fee. Otherwise you're locked—but that protects you if rates rise instead.

Yes. First-timers get 3% down conventional loans and can use gift funds for the entire down payment from family.

These offer flexible income and credit qualifying for lower-income buyers. They're not relevant in higher-priced Cerritos but work in other LA County areas.

Yes. Family can gift funds with a simple letter. Conventional loans allow 100% gifted down payments for primary residences.

Lenders order appraisals to confirm property value supports the loan. Low appraisals mean you need more cash or renegotiate price.

Initial underwriting takes 3-5 days once submitted. Conditional approvals need 1-2 weeks to clear if you respond to conditions quickly.

Rates change daily based on market conditions. Get quotes the day you're ready to lock, not weeks before—stale quotes mean nothing.

Credit scores, down payment, loan amount, and property type all affect pricing. Higher risk means higher rates—wholesale lending lets us shop for your best fit.