San Marcos Mortgage FAQs: Your Complete Guide to Home Financing in San Diego County

First-time buyers can access FHA loans with 3.5% down, conventional loans with as little as 3% down, and VA loans with zero down for eligible veterans. Community mortgages and equity appreciation loans also serve entry-level buyers.

Down payment requirements vary by loan type. FHA loans require 3.5%, conventional loans start at 3%, VA and USDA loans offer zero-down options, while jumbo loans typically need 10-20% depending on the property value.

Minimum credit scores vary by loan type. FHA loans accept scores as low as 580, conventional loans typically require 620 or higher, and jumbo loans usually need 680-700 or better for competitive rates.

Yes, self-employed buyers have multiple options including bank statement loans, 1099 loans, and profit and loss statement loans. These programs use alternative income documentation instead of traditional W-2 forms.

DSCR loans qualify investors based on rental income rather than personal income. These work well for San Marcos investors buying near CSU San Marcos or in established rental neighborhoods where properties generate steady cash flow.

Most purchase loans close in 30-45 days. Refinances often take 30-40 days. Complex scenarios like construction loans or portfolio financing may require additional time for underwriting and approval.

Standard documentation includes two years of tax returns, recent pay stubs, bank statements, photo ID, and proof of assets. Self-employed buyers may need additional business documentation or alternative income verification.

Investor loans, DSCR loans, portfolio ARMs, and interest-only loans serve San Marcos investors. Hard money and bridge loans provide short-term financing for fix-and-flip projects or quick acquisitions.

FHA loans require lower down payments and credit scores but include mortgage insurance for the loan's life. Conventional loans offer more flexibility and let you remove PMI once you reach 20% equity.

Yes, ITIN loans allow qualified buyers without Social Security numbers to purchase homes. Foreign national loans serve international buyers investing in San Marcos real estate.

Closing costs typically run 2-5% of the purchase price and include lender fees, title insurance, escrow fees, and prepaid items. Buyers and sellers negotiate who pays specific costs during the offer process.

Fixed-rate mortgages provide payment stability over the entire loan term. ARMs offer lower initial rates but adjust periodically, making them suitable for buyers planning to sell or refinance within a few years.

Private mortgage insurance protects lenders when you put down less than 20%. You can avoid PMI by making a 20% down payment, using a piggyback loan, or choosing a VA loan if eligible.

Most loan programs accept gift funds from family members for down payments and closing costs. Lenders require a gift letter stating the money doesn't need to be repaid.

Jumbo loans exceed conforming loan limits set by Fannie Mae and Freddie Mac. In San Diego County, loans above the current conforming limit require jumbo financing with stricter qualification standards.

Bank statement loans use 12-24 months of personal or business bank deposits to calculate income instead of tax returns. This helps self-employed buyers who show lower taxable income due to business deductions.

Interest-only loans let you pay just the interest for an initial period, typically 5-10 years. After that, payments increase to cover principal and interest for the remaining term.

Yes, waiting periods vary by loan type and circumstances. FHA loans may be available 2-3 years after bankruptcy, while conventional loans typically require 4-7 years depending on the situation.

Points are upfront fees that lower your interest rate. One point equals 1% of the loan amount. Buying points makes sense if you plan to keep the loan long enough to recoup the upfront cost through lower payments.

VA loans require eligible military service, a valid Certificate of Eligibility, and meeting credit and income standards. These loans offer zero down payment and no monthly mortgage insurance for qualified veterans and service members.

A home equity line of credit lets you borrow against your home's equity as needed during a draw period. You pay interest only on what you borrow, making it flexible for ongoing projects or expenses.

FHA 203(k) loans and conventional renovation loans finance both purchase and repairs in one mortgage. Hard money loans provide fast funding for investors planning extensive rehabs or flips.

Your DTI compares monthly debt payments to gross income. Most loan programs prefer DTI below 43-50%, though some portfolio products allow higher ratios for well-qualified borrowers with strong compensating factors.

San Diego County assesses property taxes at approximately 1.1-1.3% of assessed value annually. Additional assessments like Mello-Roos districts may apply. Taxes are typically paid through your monthly mortgage escrow account.

Asset depletion loans qualify borrowers using investment accounts and assets rather than traditional income. The lender divides your total assets by the loan term to calculate qualifying income.

Yes, most loan types finance condos if the complex meets lender requirements. The HOA must be financially stable, adequately insured, and meet specific owner-occupancy ratios for conventional and FHA approval.

Bridge loans provide short-term financing between buying a new home and selling your current one. These help San Marcos buyers make non-contingent offers or cover down payments before their sale closes.

Pre-approval shows sellers you're a serious buyer with verified financing. In competitive markets, pre-approval strengthens your offer and speeds up closing once you find the right property.

Community mortgages offer flexible qualification standards and may include down payment assistance or reduced fees. These programs help moderate-income buyers and underserved communities access homeownership.

Yes, you can refinance to eliminate PMI once you have 20% equity. Alternatively, conventional loans allow PMI removal at 20% equity without refinancing if you meet lender requirements.

Construction loans fund new home builds or major renovations. They typically convert to permanent mortgages after construction completes. These require detailed plans, qualified contractors, and regular inspection disbursements.

Higher rates increase monthly payments, which may reduce your maximum loan amount. Rate changes affect how much home you can afford, making it important to get pre-approved before serious house hunting.

Equity appreciation loans help buyers with smaller down payments by sharing future home value gains with the lender or investor. These reduce monthly payments in exchange for a portion of appreciation when you sell.

FHA, VA, and some adjustable-rate mortgages may be assumable, letting you take over the seller's existing loan and rate. You must qualify with the lender and the loan terms must be assumable.

You'll receive a denial letter explaining the reasons. Common issues include credit problems, insufficient income, or high debt ratios. A knowledgeable broker can suggest alternative loan programs or steps to qualify later.