Milpitas Mortgage FAQs: Your Questions Answered

Pre-approval typically takes 24-48 hours with complete documentation. Full approval and closing usually takes 30-45 days, though this varies based on loan type and property details.

FHA loans may accept scores as low as 580 with 3.5% down. Conventional loans typically require 620 or higher. Better scores generally unlock better rates and terms.

Down payments range from 3% to 25% depending on your loan type. FHA requires 3.5%, conventional allows 3-5%, while jumbo loans often need 20% or more.

You'll need recent pay stubs, W-2s, tax returns, bank statements, and ID. Self-employed borrowers may need additional documentation like 1099s or profit and loss statements.

Closing costs typically range from 2-5% of the purchase price. These include appraisal fees, title insurance, escrow fees, and lender charges.

Fixed-rate mortgages provide payment stability over 15-30 years. ARMs offer lower initial rates but adjust periodically, which can benefit shorter-term ownership plans.

Jumbo loans exceed conforming loan limits set by federal agencies. In Santa Clara County's higher-priced market, many properties require jumbo financing for amounts above conventional limits.

Yes, many programs allow smaller down payments. FHA requires 3.5%, conventional loans accept 3-5%, and VA loans offer zero-down options for eligible veterans.

Private mortgage insurance protects lenders when you put down less than 20%. You can avoid it by making a larger down payment or choosing certain loan programs.

Most lenders prefer debt-to-income ratios below 43%, though some programs allow higher. This ratio compares your monthly debt payments to gross monthly income.

FHA loans accept lower credit scores, require smaller down payments, and offer competitive rates. They're popular among first-time buyers building equity in competitive markets.

Bank statement and 1099 loans work well for tech contractors and self-employed professionals. These programs verify income through bank deposits rather than traditional pay stubs.

DSCR loans evaluate investment properties based on rental income rather than personal income. Real estate investors use these to purchase rental properties in Milpitas and surrounding areas.

Yes, self-employed borrowers have multiple options including bank statement loans, profit and loss loans, and 1099 loans. Documentation requirements differ from traditional W-2 employment.

Interest-only loans let you pay just interest for a set period, lowering initial payments. Principal payments begin later, which some investors prefer for cash flow management.

Bridge loans provide short-term financing using your current home's equity. They help buyers purchase before selling their existing property, useful in competitive markets.

VA loans offer eligible veterans zero down payment, no PMI, and competitive rates. They're an excellent option for service members buying in Santa Clara County.

Yes, foreign national loan programs serve non-U.S. citizens purchasing California real estate. These loans have specific documentation and down payment requirements.

ITIN loans serve borrowers without Social Security numbers who have Individual Taxpayer Identification Numbers. These programs open homeownership opportunities to more residents.

Discount points let you prepay interest to reduce your rate. This makes sense if you plan to keep the loan long enough to recoup the upfront cost through lower payments.

Pre-qualification is an estimate based on basic information. Pre-approval involves documentation review and credit checks, giving you a stronger position when making offers.

Properties near major employers, transit, and amenities may appraise higher and qualify for better terms. Location affects both the purchase price and lender requirements.

HELOCs let you borrow against your home's equity as needed, similar to a credit card. They're useful for renovations, investments, or other major expenses.

Yes, homeowners often use HELOCs from their primary residence to fund down payments on investment properties. This strategy helps investors expand their portfolios.

Bank statement loans use 12-24 months of personal or business bank statements to verify income. Lenders analyze deposits to determine qualifying income for self-employed borrowers.

Several county and state programs offer down payment help for eligible first-time buyers. Requirements vary by income, property price, and specific program guidelines.

Asset depletion loans qualify borrowers based on assets rather than income. They divide total assets by the loan term to calculate monthly qualifying income.

Hard money loans can close in days rather than weeks. Real estate investors use them for quick purchases, renovations, or bridge financing situations.

Rates vary by credit score, down payment size, loan type, and market conditions. Your specific rate depends on your complete financial profile and chosen loan program.

Fifteen-year mortgages build equity faster and cost less in total interest but have higher monthly payments. Thirty-year loans offer lower payments with more long-term interest costs.

Portfolio ARMs are adjustable-rate mortgages held by lenders rather than sold to investors. They often feature flexible terms for unique borrower situations or property types.

Construction loans finance property purchase and renovation costs together. They're ideal for buyers planning significant improvements to Milpitas properties.

Community mortgages consider non-traditional factors like rent payment history and utility bills. They help borrowers who may not qualify through standard underwriting build homeownership opportunities.

Lenders typically count 75% of projected rental income toward qualification. DSCR loans focus primarily on the property's income potential rather than personal earnings.

Rate locks guarantee your interest rate for 30-60 days during the closing process. This protects you from rate increases while your loan processes.