El Cajon Mortgage Questions Answered - Your Complete FAQ Guide

The approval process usually takes 30 to 45 days from application to closing. Timeline depends on loan type, documentation completeness, and appraisal scheduling. Rates vary by borrower profile and market conditions.

FHA loans may accept scores as low as 580 with 3.5% down. Conventional loans typically require 620 or higher. Higher scores often qualify for better rates and terms.

Down payments range from 0% for VA loans to 3% for FHA and conventional programs. Putting 20% down eliminates private mortgage insurance. Your specific amount depends on loan type and property price.

Standard documents include two years of tax returns, recent pay stubs, W-2s, bank statements, and ID. Self-employed borrowers may use bank statements or profit and loss statements depending on the loan program.

Yes. Bank statement loans, 1099 loans, and profit and loss statement loans serve self-employed borrowers. These programs use deposits or business financials instead of traditional income verification.

FHA loans require as little as 3.5% down with lower credit scores. Conventional loans offer better rates for strong credit and allow lower mortgage insurance costs with 20% down.

Yes. ITIN loans allow borrowers with Individual Taxpayer Identification Numbers to purchase homes. These programs serve non-citizens establishing credit and homeownership in the United States.

Closing costs typically range from 2% to 5% of the loan amount. They include appraisal fees, title insurance, escrow charges, and lender fees. Some loan programs allow sellers to contribute toward these costs.

PMI applies when you put less than 20% down on a conventional loan. FHA loans require mortgage insurance regardless of down payment. PMI protects the lender if you default.

DSCR loans evaluate investment properties based on rental income versus mortgage payments. Real estate investors use these loans because approval focuses on property cash flow rather than personal income.

VA loans require no down payment and no monthly mortgage insurance. Eligible veterans, active military, and qualified spouses can purchase with competitive rates and relaxed credit requirements.

El Cajon offers diverse neighborhoods from downtown to suburban areas near Fletcher Parkway. Working with a local agent familiar with schools, transit, and amenities helps identify the right fit.

Fixed-rate mortgages maintain the same payment for the entire loan term. ARMs offer lower initial rates but adjust periodically. Your choice depends on how long you plan to keep the home.

Asset depletion loans qualify borrowers based on retirement accounts, investment portfolios, or liquid assets. The lender divides total assets by 360 months to calculate qualifying income.

Yes. Construction loans and renovation programs finance both purchase and repairs in a single loan. These options help buyers improve properties without paying cash upfront for renovations.

Jumbo loans exceed conforming loan limits set by federal agencies. San Diego County requires jumbo financing for many properties due to higher prices. These loans typically need stronger credit and reserves.

Interest-only loans let you pay just the interest for an initial period, typically 5 to 10 years. After that, payments increase to include principal. These suit buyers expecting income growth.

A rate lock guarantees your interest rate for a set period during the loan process. Lock when rates are favorable and you're within 30 to 60 days of closing.

Some programs accept borrowers with past bankruptcies or foreclosures after waiting periods. FHA requires two years after bankruptcy and three years after foreclosure. Alternative loans may have flexible requirements.

Discount points lower your interest rate by paying upfront fees. Each point costs 1% of the loan amount. Buy points if you plan to keep the loan long enough to recoup the cost.

Bridge loans provide short-term financing to buy a new home before selling your current one. They help competitive buyers make non-contingent offers in active markets.

Portfolio ARMs are adjustable-rate mortgages held by the lender rather than sold to investors. They offer flexible underwriting for unique borrower situations or property types.

Yes. Lenders require proof of homeowners insurance before closing. Your policy must cover the property value and remain active throughout the loan. Shop multiple insurers for the best rates.

Community mortgages serve specific groups like teachers, healthcare workers, or first responders. They may offer down payment assistance, rate discounts, or relaxed qualification requirements.

Yes. Home equity loans and HELOCs let homeowners borrow against existing equity. Fixed-rate home equity loans provide lump sums, while HELOCs offer revolving credit lines.

DTI compares your monthly debt payments to gross income. Most loans require DTI below 43% to 50%. Lower ratios improve approval odds and may qualify you for better terms.

Yes. Investor loans, DSCR loans, and portfolio loans serve real estate investors. These programs evaluate properties based on rental income potential rather than traditional employment income.

Foreign national loans serve non-U.S. citizens purchasing California real estate. They require larger down payments, typically 30% to 40%, and evaluate credit history from the borrower's home country.

Earnest money demonstrates your commitment to purchase. Buyers typically deposit 1% to 3% of the purchase price when making an offer. This money applies toward your down payment at closing.

Yes. Pre-approval involves submitting financial documents for lender review before finding a property. It strengthens your offer and shows sellers you're a serious buyer with verified financing.

The lender orders an appraisal to verify the property's value matches the purchase price. An appraiser inspects the home and compares it to recent sales of similar properties nearby.

Hard money loans fund quickly based on property value rather than borrower credit. Investors use them for fix-and-flip projects or when traditional financing isn't available. They carry higher rates and shorter terms.

Equity appreciation loans let lenders share in future home value increases in exchange for reduced rates or assistance with the down payment. Terms vary but typically include a repayment trigger at sale or refinance.

USDA loans target rural areas and require properties to meet location eligibility. Most of El Cajon doesn't qualify due to population density. Check USDA maps to see if specific addresses are eligible.

Reverse mortgages let homeowners 62 and older convert home equity into cash without monthly payments. The loan is repaid when you sell, move, or pass away. Significant equity is required.

Title insurance protects against ownership disputes, liens, or legal claims on the property. Lenders require lender's title insurance, and buyers typically purchase owner's coverage for additional protection.

California's Proposition 13 caps property tax increases at 2% annually. New purchases are assessed at current market value. Budget approximately 1% of the purchase price annually for property taxes.

Yes. Once you reach 20% equity through payments or appreciation, you can refinance to remove PMI on conventional loans. FHA mortgage insurance may require refinancing into a conventional loan.

Pre-qualification is an estimate based on information you provide. Pre-approval involves document verification and credit checks. Sellers take pre-approval more seriously when evaluating offers.

Conventional loans often offer the lowest rates for qualified borrowers. FHA, VA, and alternative programs may have higher or lower rates depending on your profile. Rates vary by borrower profile and market conditions.