FAQs

We offer a wide range of home loans for your refinance, including:

• Conventional
• FHA
• VA
• Jumbo
• Non-QM

Refinancing your home is a good idea if it’ll save you money or allow you to pay off your mortgage faster. It’s also a great way to consolidate high-interest debt by using a cash-out refinance to tap into your home’s equity.

Generally, you can expect to pay anywhere from 2% to 6% of your loan amount. The cost will depend on several factors such as your lender, where you live, the state of your finances, the terms, etc. Some of the typical fees include:

• Application fee
• Origination fee
• Credit report fee
• Home appraisal
• Home inspection
• Title search and insurance fee
• Recording fee
• Reconveyance fee

The requirements will vary depending on your lender and the terms of the loan. You might NOT qualify if you:

• Have poor credit
• Have a high debt-to-income ratio
• Have a lien on your home
• Are underwater on your mortgage (you owe more than your home is worth)

Refinancing your home typically takes between 30 to 45 days to complete. It’s important to note, however, that any of the services provided by third parties (such as appraisals or inspections) may delay the process.

An interest rate is the percentage of your total loan balance, paid on a monthly basis, that you pay a lender in exchange for borrowing money from them.

APR (annual percentage rate) is the yearly interest rate that takes into account all of the other charges or fees of your loan (such as mortgage insurance, closing costs, and loan origination fees). APR is a tool you can use for an apples-to-apples comparison of various loans.

Yes, we do! Locking in a mortgage rate can protect you from fluctuations in the market and we’re happy to do that for you.

You can purchase a single-family home, condo, or townhome with a conventional mortgage through a private lender. The property can be your primary residence, a second home, or an investment property (such as a rental).

For lenders, it’s all about how much risk you pose to them as a borrower. When determining your interest rate, they’ll typically look at your credit score, the amount of debt you have, and how much of a down payment you plan to make. They’ll also take into consideration what the current market reflects.

For a conventional mortgage, lenders will typically want to see:

• A copy of your driver’s license
• Two years of W2s (or 2 years of full tax returns if you’re self-employed
• 2 recent pay stubs
• A copy of your mortgage statement (if you’re currently paying on a home loan)

An FHA loan is one that’s insured by the Federal Housing Administration (FHA). The FHA doesn’t lend you the money, you get it from a bank or private lender. The FHA simply insures the loan to protect lenders against losses, such as a property owner defaulting on their mortgage.

FHA loans are very similar to conventional loans. You’ll apply for a loan with a bank or lender that’s FHA-approved (many are) and will go through the same process to obtain a loan. The difference is that it’s typically easier to qualify for an FHA loan than it is for a conventional loan.

Many home buyers get a traditional FHA loan, but there are other FHA loan types that might better fit your situation:

• Home Improvement Loan
• Graduated Payment Mortgage
• Reverse Mortgage
• Energy Efficient Mortgage

FHA mortgages are backed by the government (the Federal Housing Administration), while conventional loans are not. FHA loans have more relaxed credit and financial requirements than conventional loans, making them a popular option among home buyers.

Aside from the credit score, down payment, and income requirements we’ve listed previously on this page, FHA loans also require that you:

• Get an appraisal by an FHA-approved appraiser
• Get an inspection of the property
• Plan to live in the home as your primary residence
• Move in within 60 days of closing

There are many benefits, including:

• Low down payment
• Flexible credit score and debt-to-income (DTI) requirements
• Low interest rates
• Sellers can contribute to closing costs
• Gift funds are allowed for the down payment
• Just about every lender offers FHA loans

Like any type of loan, FHA loans do have some disadvantages, including:

• Mortgage insurance is required
• There are FHA loan limits for each county in the U.S.
• They may not be as attractive to sellers (because of the inspection standards that may result in the seller having to complete repairs prior to closing)
• You can’t buy a vacation home or investment property with an FHA loan

Yes, you can. Your student loan debt is, however, included in your monthly debts, and if it pushes your debt-to-income ratio too high, you might not qualify for a mortgage.

Yes, you are required to have mortgage insurance (unless you put down 20 percent or more on your home purchase).

FHA loans are one of the most popular types of loans because they’re easier to qualify for than conventional loans. Even those with blemished credit or low scores can qualify.

A jumbo loan can help you purchase a home that exceeds the conforming loan limits set by Fannie Mae and Freddie Mac. As of 2022, the limit is $647,200 for most of the U.S., apart from Alaska, Hawaii, Guam, and the U.S. Virgin Islands, where the limit is $970,800.

A jumbo loan can be used to purchase a primary residence, an investment property, or a vacation home. Rates tend to be a bit higher because lenders generally have a higher risk.

A jumbo loan can help you purchase a home that exceeds conforming loan limits, such as those in a highly competitive market, or in a desirable area.

Financing is available for up to $2.5 million and jumbo loans offer the convenience of one loan vs. multiple loans.

To qualify, you’ll need to be a high earner, have a great credit score, and have a low debt-to-income ratio.

A conforming loan meets the loan limit set by Fannie Mae and Freddie Mac, which is $647,200 for most of the U.S. (the limit is $970,800 in Alaska, Hawaii, Guam, and the U.S. Virgin Islands).

A jumbo loan exceeds those limits and is therefore considered non-conforming.

Because lenders are taking on a bigger risk, you can expect a higher interest rate. It ultimately depends on the market conditions, plus your lender.

Visit the U.S. Department of Veterans Affairs Certificate of Eligibility page for instructions on requesting a COE.

Yes, you can ask your lender to obtain your Certificate of Eligibility on your behalf.

You can finance up to $2.5 million, as long as you qualify.

Here’s how the process works:

• Complete our simple Jumbo Loan Qualifier
• We’ll give you loan options based on your criteria and scenario
• We’ll help you compare mortgage interest rates and terms
• You’ll choose the offer that best fits your needs

A non-QM loan, or non-qualified mortgage, is one where alternative methods are used to verify income. For example, you can provide bank statements to a lender or use your assets to show that you have the ability to repay a loan.

A qualified mortgage is one that meets the standards outlined in the Dodd-Frank Wall Street Reform and Consumer Protection Act (regulation that took effect in 2010 following the financial crisis of 2007-2010).

Qualified mortgages do not permit risky loan features, such as interest-only loans, balloon payments, and negative amortization.

The biggest benefit is that non-traditional borrowers have an opportunity to purchase a home. Borrowers can also show proof of income in different ways, such as by providing bank statements. And you can even qualify for a non-QM loan just one day after completing a bankruptcy or foreclosure.

They’re designed for the following types of buyers:

• Self-employed
• Variable income
• Assets, but no income
• Bad credit
• Bankruptcy
• Foreclosure

DSCR stands for Debt Service Coverage Ratio, which is a comparison of a property’s cash flow to its debt obligations. Lenders will look at this ratio to see whether the property you want to purchase has enough positive cash flow to cover the loan.

Lenders typically want to see a debt service coverage ratio between 1.25 to 1.50, which indicates there will be enough net operating income to cover the loan.

For reference, a DSCR of 1.0 means there is just enough cash flow to cover the loan and that you’ll be breaking even. This is a vulnerable position to be in, and lenders are wary that the mortgage might not get paid if cash flow dips. A DSCR of 1.25 to 1.50 means there’s enough cash flow to cover the loan, plus some additional buffer, which makes lenders much more comfortable.

When you apply for a home loan, lenders will look at your personal income and compare it to your expenses. The calculation tells a lender whether you have enough money in your budget for a monthly mortgage payment.

This can be problematic if you're an investor, especially if you have multiple properties in your portfolio. Your monthly debt payments could very well be more than your personal income, automatically disqualifying you from obtaining a loan.

That's why DSCR, where lenders instead look at cash flow and personal income is taken out of the equation, is great for investors.

As with any type of home loan, it’s important to understand both the pros and cons.

Pros

• Your personal income is not a factor in qualifying
• Faster application and closing
• Easy to scale because there’s no limit on properties

Cons

• A hefty down payment of 20% to 25%
• May have a higher interest rate than a traditional mortgage
• Not designed for large investments over $5 million

A 1031 exchange refers to the sale of one investment property and the purchase of another. When you follow the IRS rules for the swap, you can defer taxes on capital gains

Both investments have to be “like-kind” (similar in nature). For example, real estate such as houses, buildings, vacant lots, etc., are like-kind investments that you can exchange. Your new acquisition must also be of equal or greater value than your existing investment.

How Exchanges Are Structured

Depending on your situation, there are four ways to structure an exchange:

• Simultaneous Exchange: Buying and selling at, or very close to, the same time
• Delayed Exchange: Buying and selling within 180 days
• Reverse Exchange: Buy first, sell later
• Construction or Improvement Exchange: Typically used when vacant, underdeveloped land is acquired

When you sell an investment property you’re required to pay a capital gains tax, which eats into your sale profit.

The benefit of a 1031 exchange is that it allows you to sell an investment property, buy another one and defer the capital gains tax. The tax would only be due when you sell the property.

The result is that you get to keep more of the sale profit, which you’re required to reinvest in order to gain the advantage of the deferred capital gains tax.

Because self-employed borrowers don’t have a W-2, there is more documentation required to prove income and verify the business. However, the rest of the loan process, and standards, are the same as they would be for borrowers who work for employers.

Lenders are taking on added risk when loaning money to someone self-employed who seeks a mortgage and may increase the interest rate to account for that.

To become attractive to lenders, you’ll want to:

• Check your credit report and resolve any discrepancies
• Improve your debt-to-income ratio by increasing your income and/or reducing your debt
• Save up a large down payment
• Put significant cash reserves in the bank
• Make sure you have all the required documentation