Pasadena Mortgage FAQs — Your Questions Answered by Local Brokers

Conventional loans need 3-5% down. FHA requires 3.5%. Jumbo loans for homes over $806,500 typically need 10-20% depending on the lender and your credit profile.

FHA approves at 580. Conventional loans start at 620. Jumbo lenders in Pasadena typically want 700+ for the best rates and terms.

Most conventional and FHA loans close in 21-30 days. Jumbos and non-QM loans can take 30-45 days due to extra underwriting steps.

W-2 earners need two years of tax returns, two months of pay stubs, and two months of bank statements. Self-employed borrowers need two years of business returns plus personal returns.

Yes. Sellers in competitive Pasadena neighborhoods won't consider offers without a pre-approval letter from a legitimate lender.

Pre-qualification is an estimate based on what you tell us. Pre-approval means a lender reviewed your documents and verified your finances.

Many are. The conforming loan limit is $806,500 in LA County. Homes in areas like San Rafael or Oak Knoll often exceed that threshold.

Brokers shop 200+ lenders to find better rates and programs than one bank offers. We also know which lenders move fast in competitive LA County markets.

VA loans require zero down for eligible veterans. USDA loans also offer zero down but won't work in Pasadena since it's not a rural area.

Expect 2-5% of the loan amount. On a $900,000 loan, that's $18,000-$45,000 depending on lender fees, title insurance, and property taxes.

Only if you're keeping the loan for 5+ years. Each point costs 1% of the loan amount and typically reduces your rate by 0.25%.

Private mortgage insurance applies when you put down less than 20% on a conventional loan. You can avoid it with a piggyback loan or by waiting until you have 20% down.

Traditional lenders average your last two years of income from tax returns. If your returns show write-offs that lower taxable income, consider bank statement or 1099 loans instead.

Bank statement loans let self-employed borrowers qualify using deposits instead of tax returns. We calculate income from 12-24 months of business bank statements.

Yes. Most lenders count 75% of documented rental income. You'll need a current lease agreement and proof the rent hits your account monthly.

DSCR loans approve based on rental income from the property itself, not your personal income. They work well for investors buying Pasadena rental properties.

ARMs make sense if you plan to sell or refinance within 5-7 years. Initial rates run 0.5-1% lower than fixed rates. Rates vary by borrower profile and market conditions.

FHA allows lower credit scores and smaller down payments but requires mortgage insurance for the loan's life. Conventional loans drop PMI once you hit 20% equity.

Yes. FHA 203(k) and conventional renovation loans let you finance both purchase and repairs in one loan. Hard money loans work for flips you'll sell within 12 months.

Expect to show 700+ credit, 10-20% down, and reserves covering 6-12 months of payments. Debt-to-income ratios need to stay below 43% for most lenders.

Lenders want your total monthly debts below 43-50% of gross income. For a $900,000 home with 10% down, you'd need roughly $16,000/month gross income.

Maybe. Tax liens need a payment plan in place. Bankruptcies require 2-4 years of clean credit depending on the loan type and lender guidelines.

Portfolio ARMs are adjustable-rate loans held by the lender instead of sold to Fannie or Freddie. They allow more flexibility on income documentation and property types.

Usually. Most lenders require an appraisal to confirm current home value. Some offer appraisal waivers if you have strong equity and clean payment history.

Home equity loans provide a lump sum with fixed rates. HELOCs work like a credit card with a variable rate you draw from as needed.

Yes. Foreign national loans require 20-40% down and don't need US credit history or Social Security numbers. Rates run 1-2% higher than conventional loans.

ITIN loans let borrowers without Social Security numbers use an Individual Taxpayer Identification Number instead. Requirements mirror conventional loans: 15-20% down and 680+ credit.

You pay only interest for 5-10 years, then payments jump when principal payments begin. They help investors maximize cash flow or buyers expecting income growth.

Bridge loans let you buy a new home before selling your current one. Terms run 6-12 months with higher rates. They work when you need to move fast in competitive markets.

California offers CalHFA loans with down payment assistance. FHA loans work well for first-timers due to low down payment and credit requirements.

Every 1% rate increase cuts buying power by roughly 10%. At 6% you qualify for less home than at 5%, assuming the same income and debts.

Yes. 1099 loans use your gross income from tax returns or bank deposits. Most lenders need 12-24 months of steady contract work in the same field.

Asset depletion loans calculate income by dividing your liquid assets by 60-360 months. Retirees with investments but no W-2 income use these programs.

Lock if rates are rising or you're close to closing. Float if you have 45+ days and rates are trending down. Rate locks typically last 30-60 days.

You can renegotiate price, bring more cash to close, or cancel the deal if you have an appraisal contingency. Low appraisals are rare in strong Pasadena markets.

Banks offer their own products. Brokers shop 200+ lenders to find better rates and programs that fit non-standard income or credit situations.