MORTGAGE QUESTIONS, EXPLAINED
Your questions.
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Buying or refinancing a home? Start with a direct answer, check the official source, and put the numbers into your plan.
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MORE THAN TWO DECADES OF EXPERIENCE
Enrique Pelayo Jr, AMPFounder of Mortgage Lending Group LLC. Personal guidance for home purchases, refinancing and equity decisions, in English and Spanish. Serving Seattle and nearby communities from Edmonds.
NMLS #131435 · Mortgage Lending Group LLC · CL-1157983
What does the AMP designation mean?
AMP stands for Accredited Mortgage Professional. The Mortgage Bankers Association awards this designation to graduates of its three-course School of Mortgage Banking. It represents additional professional education in the mortgage business.
That education complements Enrique’s hands-on experience explaining costs, choices and the mortgage process. The designation is separate from a state license and does not guarantee approval or a particular rate.
View Enrique’s AMP credential ↗ · MBA program requirements ↗Buying
Do I need 20% down to buy a home in Washington?
No. Eligible buyers may use a smaller down payment; Fannie Mae’s HomeReady program permits as little as 3% down.
Read the answer & source ↗Can gift funds cover my down payment?
Eligible gift funds can help with a down payment, but donor eligibility, documentation, occupancy, and borrower-contribution rules depend on the loan program.
Read the answer & source ↗Can I finance a condo or a second home?
Potentially. Condo project eligibility and intended occupancy affect the loan review, and second-home requirements differ from those for a primary residence.
Read the answer & source ↗How long does mortgage preapproval take, and what can delay it?
Preapproval timing depends on the lender’s review and the information available. Ask for a turnaround estimate after the lender identifies the documents it needs; a letter is not a guaranteed loan offer.
Read the answer & source ↗Seller credit or lower price: which helps a Seattle buyer?
Compare cash needed now with debt carried later: a usable seller credit reduces closing expenses, while a lower price can reduce your down payment and loan amount.
Read the answer & source ↗How much savings should I keep after closing?
Keep a cushion that fits your household, separate from planned moving or repair costs. Your lender’s reserve requirement is a different calculation.
Read the answer & source ↗Qualifying
How is mortgage eligibility determined?
A lender evaluates your documented income, debts, credit, assets, occupancy, and property against the selected loan program and its own requirements.
Read the answer & source ↗What is a mortgage debt-to-income ratio?
Debt-to-income, or DTI, divides qualifying monthly debt payments by qualifying gross monthly income and expresses the result as a percentage.
Read the answer & source ↗Can I get a mortgage if I am self-employed in Washington?
Yes, self-employed borrowers may qualify when the lender can document acceptable income, business history, stability, and the other requirements of the selected program.
Read the answer & source ↗Can rental income help me qualify for a mortgage?
Possibly. Fannie Mae now separates rental-income rules by property and scenario; a lender must verify the relevant history, lease or other documentation and qualifying calculation before counting rent.
Read the answer & source ↗What are lender overlays on a mortgage?
Lender overlays are requirements a lender applies in addition to a loan program’s baseline rules; they can affect eligibility and documentation.
Read the answer & source ↗What credit score do I need for a conventional mortgage?
There is no universal conventional-loan minimum: Fannie Mae’s DU casefiles have no minimum credit score, while manual underwriting and lender rules differ.
Read the answer & source ↗Loan programs
How are FHA loans different from conventional loans?
FHA insures eligible loans made by approved lenders; its mortgage-insurance, underwriting, and property requirements differ from those of conventional loan programs.
Read the answer & source ↗Does an FHA loan require an appraisal?
FHA purchase financing includes an appraisal and property review; an appraisal does not replace an independent home inspection.
Read the answer & source ↗Where can I find VA, USDA, jumbo, and DSCR loan rules?
Use official VA and USDA guidance for those programs; jumbo and DSCR terms require a review of the specific lender’s written requirements.
Read the answer & source ↗Is there one FHA debt-to-income limit for everyone?
No single FHA DTI percentage establishes approval for everyone; underwriting method, compensating factors, and lender requirements affect the review.
Read the answer & source ↗Refinance & equity
Should I refinance just because the rate is lower?
Not necessarily. Compare closing costs, monthly savings, remaining loan term, new balance, and how long you expect to keep the loan.
Read the answer & source ↗What rules apply to a cash-out refinance?
Cash-out eligibility depends on equity, ownership and mortgage seasoning, credit, income, property type, and the selected program’s requirements.
Read the answer & source ↗Should I use a cash-out refinance to consolidate debt?
Compare total borrowing costs and repayment time, not only monthly relief; cash-out consolidation can turn unsecured balances into debt secured by your home.
Read the answer & source ↗Loan costs
What is the difference between mortgage interest rate and APR?
The interest rate measures borrowing interest; APR includes the interest rate and certain additional financing charges, expressed as an annual percentage.
Read the answer & source ↗How do mortgage points and lender credits work?
Discount points generally exchange upfront cost for a lower rate; lender credits generally reduce upfront closing costs in exchange for a higher rate.
Read the answer & source ↗Is an online mortgage quote a rate lock?
No. An online quote is not a confirmed lock; ask the lender for written lock terms, the expiration date, and applicable conditions.
Read the answer & source ↗What closing costs should I budget for a Washington home purchase?
Budget for lender charges, third-party services, government charges, prepaid expenses, and initial escrow funding, separately from the down payment.
Read the answer & source ↗Washington guidance
Go deeper into your plan
County loan limits · WSHFC Home Advantage · Broker or bank? · Local guides
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