Mortgage FAQs for Gustine, CA Homebuyers

FHA loans start at 580 credit score with 3.5% down. Conventional loans typically require 620 minimum, though some lenders go lower with compensating factors.

FHA requires 3.5% down, conventional loans allow 3% for first-timers. USDA loans offer zero down for eligible rural properties in Merced County.

Some areas may qualify depending on USDA rural designation maps. We check eligibility by property address since boundaries shift frequently.

Standard W-2 loans need two years tax returns, recent paystubs, and bank statements. Self-employed borrowers need business tax returns and proof of income continuity.

Pre-approval takes 1-3 days with complete documents. Full closing averages 30-45 days depending on appraisal turnaround and title work in Merced County.

Yes. Bank statement loans use 12-24 months of deposits to qualify instead of tax returns. We also offer profit and loss statement programs for seasonal ag income.

FHA loans work well with 3.5% down and 580 credit. Conventional 97 LTV loans avoid upfront mortgage insurance if you have 620+ credit.

Expect 2-5% of purchase price for fees, title insurance, and prepaid taxes. Merced County transfer taxes and recording fees are lower than coastal counties.

Only if you keep the loan past breakeven, typically 3-5 years. Most Gustine buyers refinance or move before points pay off.

FHA allows lower credit and smaller down payments but requires mortgage insurance for life. Conventional drops PMI at 20% equity and offers better rates above 740 credit.

Yes. Lenders use 50-75% of gross deposits to calculate income instead of adjusted gross on your 1040. This helps self-employed borrowers with heavy deductions qualify.

FHA requires it regardless of down payment. Conventional loans need PMI under 20% down, but you can cancel it once equity reaches 20%.

Debt Service Coverage Ratio loans qualify investors using rental income, not personal W-2 income. Popular for Gustine rental property purchases without income documentation.

No. Investment properties require 15-25% down depending on credit and loan type. DSCR loans typically need 20% minimum.

Lenders qualify independent contractors using gross 1099 income before expenses. You need consistent 1099 history across 12-24 months.

You pay only interest for 5-10 years, then principal and interest after. Used by investors and high earners expecting income growth or property sale.

Yes. ITIN loans work like conventional mortgages but use Individual Taxpayer Identification Numbers. Expect 15-20% down and full income documentation.

ARMs offer lower initial rates that adjust after 5, 7, or 10 years. Good if you plan to sell or refinance before adjustment, risky otherwise.

Bridge loans let you buy before selling your current home. Short-term financing with higher rates, paid off when your old property closes.

Lenders divide liquid assets by 360 months to create qualifying income. Helps retirees or high-net-worth buyers without traditional paystubs qualify.

Yes. Foreign national loans require 20-30% down and US-based assets or international income verification. Rates run higher than conventional products.

Short-term financing for fix-and-flip investors or buyers who can't qualify conventionally. Rates start around 8-12% with 2-3 year terms.

Not required but strongly recommended. Older properties and ag-adjacent homes may have well, septic, or foundation issues that affect value and insurability.

HELOCs are revolving credit lines with variable rates. Home equity loans provide lump sums with fixed rates and payments.

Yes, once equity reaches 20% through payments or appreciation. Refinancing to conventional eliminates PMI if home value supports it.

Jumbo loans exceed conforming limits, currently $806,500 in Merced County. Gustine prices rarely hit this threshold, so most buyers use conventional financing.

Lenders fund in stages as construction progresses. You pay interest-only during the build, then convert to permanent financing at completion.

Homeowners 62+ can convert equity to income without monthly payments. Loan repays when you sell, move, or pass away.

Pre-approval carries more weight because lenders verify income, assets, and credit. Pre-qualification is an estimate without documentation review.

Most lenders lock rates once you have an accepted offer and signed purchase contract. Some offer float-down options if rates drop before closing.

Most lenders require 620 for conventional financing. We access portfolio lenders who go to 580 with larger down payments and strong compensating factors.

Debt-to-income ratios typically cap at 43-50% depending on loan type. Your total monthly debts including the new mortgage can't exceed that percentage of gross income.

Yes. FHA 203k loans roll purchase price and renovation costs into one mortgage. Good for Gustine buyers targeting distressed properties below market value.

You can renegotiate price, increase down payment to cover the gap, or walk away if you have an appraisal contingency. Lenders only finance appraised value.

Yes. Lenders require proof of insurance before funding. Rural Gustine properties may face higher premiums if near ag operations or wildfire zones.

Focus on APR, which includes rate plus fees. Compare Loan Estimates side by side and watch for lender credits or discount points affecting upfront costs.

Rate locks guarantee your interest rate for 30-60 days while you close. Extensions cost extra if closing delays push past the lock period.

Yes. FHA and conventional loans allow gifted funds from family members. You'll need a signed gift letter stating the money doesn't require repayment.

Lenders collect monthly portions of property taxes and insurance into escrow, then pay bills when due. Required on most loans under 20% down.

Brokers access 200+ lenders instead of one bank's products. We shop rates and match your profile to programs you wouldn't find on your own.