West Covina Mortgage FAQs: Your Questions Answered by Local Brokers

Most conventional loans require 620 minimum. FHA drops to 580, but expect higher rates below 620.

Conventional loans start at 3% down for first-time buyers. FHA requires 3.5%, while VA and USDA offer zero-down options if you qualify.

Bring two years of tax returns, recent pay stubs, and two months of bank statements. Self-employed borrowers need profit and loss statements.

Pre-approval takes 1-2 days. Full underwriting runs 20-30 days for conventional loans, sometimes faster with streamlined programs.

Yes. We use bank statement loans, 1099 loans, or P&L programs that don't require tax returns—perfect for business owners who write off income.

FHA allows lower credit scores and 3.5% down but charges lifetime mortgage insurance. Conventional drops PMI at 20% equity and suits stronger borrowers.

Yes, if you put down less than 20% on a conventional loan. FHA charges both upfront and monthly mortgage insurance premiums regardless of down payment.

Jumbo loans exceed conforming limits—$806,500 in Los Angeles County for 2024. They require stronger credit and larger down payments but handle higher home prices.

Yes, if you're military, veteran, or eligible spouse. VA loans offer zero down, no PMI, and competitive rates—one of the best programs available.

Expect 2-5% of purchase price. That covers lender fees, title insurance, escrow, and county recording charges specific to Los Angeles County.

Only if you're keeping the loan 5+ years. Each point costs 1% of loan amount and drops your rate about 0.25%.

DSCR loans qualify investors based on rental income, not personal income. Perfect for buying West Covina investment properties when you can't show traditional employment.

Yes. FHA 203(k) and conventional renovation loans bundle purchase and repair costs into one loan—standard mortgages won't fund homes needing major work.

Most lenders cap DTI at 43-50%. That means your total monthly debts can't exceed roughly half your gross income.

Brokers shop 200+ lenders instead of offering one bank's products. We find better rates and approve deals that single-lender banks decline.

Yes. ITIN loans serve borrowers without Social Security numbers through specialized lenders—not available at traditional banks.

Lenders verify income using 12-24 months of business or personal bank deposits instead of tax returns. Self-employed borrowers with solid cash flow benefit most.

Thirty-year loans keep payments lower and preserve cash flow. Fifteen-year terms build equity faster and save on interest but nearly double your payment.

You pay only interest for 5-10 years, then principal kicks in. Works for buyers expecting income growth or planning to sell before the adjustment.

Yes. Most programs allow gifted funds from family members with a signed letter confirming it's not a loan requiring repayment.

ARMs offer lower initial rates that adjust after a fixed period—typically 5, 7, or 10 years. Best if you're selling or refinancing before adjustment.

Construction loans need detailed builder contracts, plans, and budgets. Expect 20-25% down and strong credit since they carry more risk than standard mortgages.

Bridge loans provide short-term financing when buying before selling your current home. Terms run 6-12 months with higher rates than traditional mortgages.

Some portfolio lenders offer 15% down on investment properties. DSCR loans occasionally drop to 15% for strong rental income scenarios.

Pre-qualification is an estimate based on what you tell us. Pre-approval verifies income, assets, and credit—it carries weight with sellers.

Chapter 7 requires 2-4 year wait depending on loan type. Chapter 13 allows FHA financing after 12 months of payment history.

Lenders calculate income by dividing your liquid assets by loan term—typically 360 months. Retirees or investors with substantial savings use this method.

Yes. Foreign national loans require 20-30% down and don't need US credit or income documentation—passport and bank statements work.

Hard money loans fund based on property value, not borrower credit. Investors use them for quick closings or properties that won't qualify for conventional financing.

Lock if rates are rising or you're closing soon. Float only if rates are falling and you can handle potential increases.

Broker compensation comes from lender-paid commission or borrower-paid fees—typically 1-2% of loan amount. We disclose all costs upfront in your loan estimate.

Lenders approve loans where your housing payment stays under 28-36% of gross monthly income. Calculate affordability before house hunting to avoid disappointment.

Community mortgages consider non-traditional credit—rent and utility payments—for borrowers without established credit history. Some programs offer down payment assistance.

Yes, once you reach 20% equity through payments or appreciation. Conventional loans automatically drop PMI at 22% equity based on original value.

We access non-QM lenders who approve deals banks decline—recent credit events, complex income, or unique property types. Most denials have alternative solutions.

HELOCs are revolving credit lines you draw from as needed. Home equity loans provide lump-sum cash with fixed payments—both use your home as collateral.

Conventional investment loans require 15-25% down depending on credit and property type. DSCR loans typically start at 20% for single-family rentals.

Multiple mortgage inquiries within 45 days count as one credit pull. Shop aggressively during this window without damaging your score.

Appraisal contingencies let you renegotiate or walk away if the home values below purchase price. Waiving it risks covering the gap with cash.

Only if the complex is FHA-approved. Many West Covina condos don't qualify due to owner-occupancy ratios or reserve requirements—check before making offers.