Mortgage FAQ: Top 20 Questions Answered

It depends on the loan type. FHA loans require as little as 3.5% down. VA loans for veterans allow $0 down. Conventional loans typically require 3-20% down (though 5-10% is most common).

In Nevada, many first-time buyers use FHA with 3.5% down or take advantage of Nevada down payment assistance programs to reduce upfront costs.

Minimum credit scores by loan type:
• FHA: 580 (or 500 with 10% down)
• VA: Typically 620+, though some lenders go lower
• Conventional: 620+ (best rates at 740+)

Even if your score is below these thresholds, we can help. Manual underwriting and credit repair strategies can get you approved. Talk to a loan officer about your specific situation.

The average mortgage closing takes 30-45 days, but we often close in 21 days or less when everything's in order. Timeline depends on:

• How quickly you provide documents
• Appraisal scheduling (can take 1-2 weeks in Vegas/Reno)
• Loan type (VA/FHA take slightly longer than conventional)
• Underwriter workload

Getting pre-approved early and responding to document requests immediately can shave weeks off your timeline.

Pre-qualification = quick estimate based on self-reported info (no verification). Takes 5 minutes but isn't worth much to sellers.

Pre-approval = lender verifies your income, assets, credit, and employment. You get an official letter stating how much you can borrow. Takes 1-3 days but makes you a serious buyer.

In Nevada's competitive market (especially Las Vegas), sellers expect pre-approval letters. A pre-qualification won't cut it. Get pre-approved in 24 hours.

Expect 2-5% of the loan amount in closing costs. On a $350,000 loan, that's $7,000-$17,500. This includes:

• Lender fees (origination, underwriting)
• Title insurance and escrow fees
• Appraisal ($500-$700 in NV)
• Home inspection ($400-$600)
• Prepaid property taxes and insurance

You can negotiate seller concessions (seller pays part of your costs) or choose a slightly higher rate for lender credits to offset costs. Read our full Nevada closing costs guide.

Yes! Student loans don't disqualify you, but lenders include the monthly payment in your debt-to-income ratio (DTI). Most lenders allow up to 43-50% DTI (some FHA lenders go higher).

If you're on an income-driven repayment plan showing $0/month, some lenders use that $0 payment for DTI calculations (huge benefit!). If your loans are in deferment, lenders typically use 0.5-1% of the balance as the payment. We'll help you navigate this. Calculate your DTI here.

15-year: Lower rate, pay off faster, save huge on interest. But monthly payment is ~50% higher.
30-year: Lower monthly payment, more flexibility. You pay more interest overall but have cash flow for other goals.

Rule of thumb: If you can comfortably afford the 15-year payment and plan to stay long-term, go 15-year. If you value flexibility or might move/refi soon, stick with 30-year. See the full comparison with examples.

PMI (Private Mortgage Insurance) protects the lender if you default. It's required on conventional loans when you put down less than 20%. Costs ~0.5-1% of the loan annually ($150-300/month on a $350k loan).

How to avoid PMI:
• Put 20% down (not always feasible)
• Use a VA loan (no PMI for veterans)
• Lender-paid PMI (lender covers it via slightly higher rate)
• Piggyback loan (80-10-10: first mortgage + second mortgage + 10% down)

Good news: PMI drops off automatically once you reach 22% equity on conventional loans. You can also request removal at 20% equity.

Absolutely, but you'll need more documentation. Lenders typically want 2 years of tax returns, profit & loss statements, and bank statements to verify income. They'll average your net income (after business expenses).

Tip: Work with a lender experienced in self-employed borrowers (like us!). We know how to structure your application to maximize qualifying income. If your tax returns show low income due to write-offs, we can explore bank statement loans or other options. Talk to a specialist.

DTI = (Total Monthly Debt Payments ÷ Gross Monthly Income) × 100. It measures how much of your income goes to debt. Lenders use it to gauge affordability.

DTI limits by loan type:
• Conventional: typically 43-50%
• FHA: up to 57% (with compensating factors)
• VA: more flexible, often 50-60%

Lower DTI = easier approval + better rates. If your DTI is high, pay down debt before applying or consider a co-borrower to add income. Full DTI guide here.

Standard document checklist:

• Last 2 years of tax returns (W-2s or 1099s)
• Last 2 months of pay stubs
• Last 2 months of bank statements (all accounts)
• Government-issued ID (driver's license)
• Proof of other income (rental, child support, etc.)
• If self-employed: 2 years of business tax returns + P&L

We'll send a detailed list when you apply. Pro tip: upload everything digitally to speed up the process. Our portal makes it easy!

Pre-approval involves a hard credit inquiry, which may lower your score by 5-10 points temporarily. However, multiple mortgage inquiries within a 14-45 day window count as ONE inquiry (so shop rates without worry).

The minor short-term dip is worth it—pre-approval is essential for serious homebuying. Your score typically rebounds within a few months. Avoid applying for new credit cards or loans while mortgage shopping!

Yes! Most loan types allow gift funds from family members (parents, grandparents, siblings) for down payment and closing costs. You'll need:

• A signed gift letter stating the money is a gift (not a loan)
• Bank statements showing the donor had the funds
• Proof of transfer to your account

FHA loans are especially flexible with gifts—you can use 100% gifted funds for your 3.5% down payment. Conventional loans typically require at least 3-5% from your own funds if you're putting less than 20% down.

Interest rate = what you pay on the loan amount (e.g., 6.5%/year). This determines your monthly payment.

APR (Annual Percentage Rate) = interest rate + all loan fees (origination, points, etc.) expressed as a yearly rate. APR shows the true cost of the loan.

Example: 6.5% rate with $3,000 in fees might have a 6.65% APR. Always compare APRs when shopping lenders—a lower rate with high fees can cost more than a slightly higher rate with low fees.

Yes, but you'll need to wait a certain period and rebuild credit:

After Chapter 7 Bankruptcy:
• FHA: 2 years
• Conventional: 4 years
• VA: 2 years

After Foreclosure:
• FHA: 3 years
• Conventional: 7 years (3 years with extenuating circumstances)
• VA: 2 years

During the waiting period, focus on rebuilding credit (on-time payments, low balances, no new delinquencies). We've helped many people with past credit issues get approved. Let's discuss your timeline.

A rate lock guarantees your interest rate for a set period (typically 30-60 days) while your loan processes. If rates rise during that time, you're protected. If rates drop, you're usually stuck (unless you have a "float-down" option).

When to lock: Lock once you have a signed purchase agreement and are confident the loan will close within the lock period. Locking too early (before finding a home) wastes the lock. Locking too late (rates rising) can cost you. We'll guide you on timing based on market conditions. Full rate lock guide.

Yes. Lenders require proof of homeowners insurance (with the lender listed as loss payee) before funding your loan. You'll need to shop for insurance after your offer is accepted and have it bound (activated) before closing day.

Expect to pay the first year's premium upfront at closing (~$1,000-$2,000 in Nevada, varies by coverage). Don't wait until the last minute—start shopping for quotes 2-3 weeks before closing.

It's possible, but risky. Lenders verify employment right before closing—if you change jobs or income, it can delay or derail your loan.

Safe job changes:
• Same industry, similar/higher pay, salaried position
• W-2 employee to W-2 employee (not self-employed)

Risky job changes:
• Switching to commission-only or contract work
• Lower income or new industry
• Gap in employment

Rule: Ideally, wait until after closing to change jobs. If you must switch, inform your loan officer immediately—we can help navigate underwriter concerns.

Closing (also called settlement) is when you sign final loan documents, pay closing costs, and officially become a homeowner. Expect:

• Who attends: You, seller, title company rep, possibly real estate agents
• Duration: 1-2 hours of signing paperwork
• What you bring: Government ID, cashier's check or wire transfer for closing costs/down payment
• What you sign: Promissory note, deed of trust, closing disclosure, dozens of disclosures

After signing, the title company records the deed and lender funds the loan. You get the keys usually same day or next day. Congrats—you're a homeowner! 🎉

Not necessarily. Focus on high-DTI debts (car loans, credit cards with high monthly minimums). Paying those down can significantly improve your loan qualification.

What to prioritize:
• Credit card balances (keep utilization under 30%)
• Car loans with 1-2 years left (consider paying off)
• Collections or charge-offs (pay or settle before applying)

What NOT to drain:
• Your emergency fund (lenders like to see cash reserves)
• Retirement accounts (penalties + tax implications)

Talk to us before making big financial moves—we'll run numbers to show the best strategy for your situation.