Nevada City Mortgage FAQs – Your Questions Answered by Local Brokers

Pre-approval takes 1-2 days with full documents. Full underwriting to close runs 21-30 days for most conventional and FHA loans.

FHA accepts 580 minimum. Conventional needs 620 for best access, though some programs go to 600.

FHA requires properties meet habitability standards. Many historic Nevada City homes need work that disqualifies them from FHA until repairs are done.

FHA requires 3.5% down. Conventional goes as low as 3% for first-time buyers, 5% for repeat buyers.

Not necessarily. Age doesn't dictate loan type, but condition does. Properties built before 1978 require lead-based paint disclosures.

Two years tax returns, two months bank statements, 30 days pay stubs, photo ID, and purchase contract. Self-employed borrowers need P&L statements.

Some properties exceed conforming limits. We place jumbo loans when needed, though most Nevada City purchases stay within conventional limits.

Yes. We use 12-24 months of business or personal bank statements instead of tax returns for income calculation.

Pre-qual is an estimate based on stated income. Pre-approval involves credit check and document review, making it credible with sellers.

Expect 2-4% of purchase price. Includes lender fees, title, escrow, and prepaid taxes and insurance.

Not directly. You can negotiate seller credits or choose a higher rate with lender credits to offset costs.

Yes, if you put down less than 20%. PMI drops off automatically when you reach 78% loan-to-value through payments.

Debt Service Coverage Ratio loans qualify based on rental income, not personal income. Investors use them for Nevada City rental properties.

Only if you live in one unit of a 2-4 unit property. Single-family investment properties require conventional or investor loans.

Brokers shop 200+ lenders for the best rate and program fit. Banks only offer their own products.

ARMs start with a fixed period (5, 7, or 10 years), then adjust annually based on an index. Initial rates beat fixed rates.

These qualify you using liquid assets divided by 360 months as income. Works for retirees with investment accounts but limited W-2 income.

Yes. ITIN loans allow non-citizens to purchase property using their Individual Taxpayer Identification Number.

ARMs held by lenders in their own portfolios, not sold to Fannie or Freddie. They offer more flexible underwriting for unique situations.

Bridge loans provide short-term funding to purchase before selling your current home. Rates are higher but terms run only 6-12 months.

When your loan exceeds $806,500 in 2025. Jumbo loans require stronger credit and larger down payments than conforming loans.

Yes. Construction loans convert to permanent mortgages after completion. They require detailed plans, budgets, and qualified contractors.

Veterans get zero down payment, no PMI, and competitive rates. Funding fees apply unless you're disabled.

Nevada City itself doesn't qualify as rural. Some surrounding Nevada County areas may qualify for USDA's zero-down program.

Quick financing for fix-and-flip projects or properties that won't qualify for traditional loans. Rates are high but approval is fast.

Yes, once you have 20% equity. Refinancing resets your loan but eliminates monthly PMI payments.

You pay only interest for a set period (typically 10 years), keeping payments low. Principal payments begin after the interest-only period ends.

You accept a higher interest rate in exchange for lender-paid closing costs. This reduces cash needed at closing.

Programs designed to help underserved borrowers access financing. They often feature lower down payments and flexible credit requirements.

Most lenders require a purchase contract before locking. Float-down options let you secure a rate and improve it if rates drop.

FHA allows lower credit scores and 3.5% down but requires mortgage insurance for life of loan. Conventional drops PMI at 78% LTV.

We calculate income from your 1099 forms, typically using a percentage of gross receipts. Qualification depends on your specific earnings pattern.

Self-employed borrowers provide CPA-prepared P&L statements instead of tax returns. Banks verify statements directly with your accountant.

Yes. Foreign national loans don't require U.S. credit history or residency. Expect 20-30% down and higher rates.

Borrowers 62+ convert home equity into cash without monthly payments. Loan is repaid when you sell, move, or pass away.

HELOCs let you borrow against equity as needed during a draw period. You pay interest only on what you use.

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

Each point costs 1% of loan amount and drops your rate about 0.25%. Makes sense if you keep the loan past breakeven, typically 5-7 years.

We have 200+ lenders with different guidelines. One denial doesn't end your options. We find programs that fit your specific profile.

Cash-out refinances take 30 days minimum. Purchases can close in 21 days with complete documentation and cooperative appraisals. Rates vary by borrower profile and market conditions.