Question 1

What credit score is needed to buy a home in Cincinnati?

Accepted Answer

Most Cincinnati buyers can qualify with a 580 FICO for FHA financing or 620 for conventional. VA loans have no FHA-style minimum but lenders typically want 580-620. Higher scores unlock better pricing.

Question 2

How much down payment do I need to buy a home?

Accepted Answer

VA and USDA loans allow 0% down for eligible borrowers. FHA loans require 3.5%. Conventional first-time buyer loans start at 3% down. Investment properties typically require 20-25% down.

Question 3

What is mortgage pre-approval?

Accepted Answer

Pre-approval is a written commitment from a lender, based on a review of your credit, income, and assets, stating the maximum mortgage amount you qualify for. A strong pre-approval letter is essential to make competitive offers in the Cincinnati market.

Question 4

How long does mortgage underwriting take?

Accepted Answer

Initial underwriting typically takes 5-10 business days after a complete file is submitted. Final approval and clear-to-close usually follow within another 3-7 business days, depending on appraisal and conditions.

Question 5

Can I buy a new home before selling my current one?

Accepted Answer

Yes. Options include qualifying with both payments, using a bridge loan, executing a contingent offer, or using a HELOC on your current home. John will walk through which makes sense for your situation.

Question 6

Can self-employed borrowers qualify for a mortgage?

Accepted Answer

Absolutely. Self-employed borrowers can qualify with tax returns, 12 or 24 months of bank statements, P&L documentation, or asset-based programs. The right path depends on your business and tax structure.

Question 7

What documents do I need to apply for a mortgage?

Accepted Answer

Two years of W-2s or tax returns, 30 days of pay stubs, two months of bank/asset statements, government ID, and any additional documentation specific to your loan type (VA COE, divorce decree, etc.).

Question 8

What are FHA loan requirements?

Accepted Answer

FHA requires 3.5% down with a 580+ FICO (or 10% down with 500-579), two-year work history, debt-to-income within program limits, and a primary-residence property. FHA county loan limits also apply.

Question 9

What are VA loan benefits?

Accepted Answer

VA loans offer 0% down, no monthly mortgage insurance, competitive rates, and limits on borrower-paid closing costs. Eligible veterans, active-duty service members, and surviving spouses with a Certificate of Eligibility qualify.

Question 10

How much house can I afford?

Accepted Answer

A common framework keeps your total housing payment under 28% of gross monthly income, with all debts under 36-43%. Lenders may approve higher; your comfort zone may be lower. John helps you map both.

Question 11

What is PMI and when does it go away?

Accepted Answer

Private Mortgage Insurance is required on most conventional loans with less than 20% down. It automatically drops at 78% LTV, and you can request removal at 80% LTV. FHA mortgage insurance often lasts the life of the loan.

Question 12

Should I lock my mortgage rate?

Accepted Answer

Locking protects you from rate increases for a defined window (typically 30-60 days). The right time to lock depends on closing date, market direction, and your risk tolerance, John advises on this directly.

Question 13

How are mortgage rates determined?

Accepted Answer

Mortgage rates track the bond market, particularly mortgage-backed securities, more than the Fed funds rate. Your specific rate also depends on credit score, loan-to-value, occupancy, loan size, and program.

Question 14

What is a debt-to-income ratio?

Accepted Answer

DTI is the percentage of your gross monthly income going to debt payments (housing plus other obligations). Most loan programs cap DTI between 43% and 50%, with strong compensating factors allowing higher.

Question 15

Can gift funds be used for a down payment?

Accepted Answer

Yes. Most loan programs allow gift funds from family members, with proper documentation including a gift letter and source paper trail.

Question 16

How long should I plan to stay in a home for buying to make sense?

Accepted Answer

Generally at least 3-5 years to overcome transaction costs. The exact breakeven depends on price, down payment, rate, and local appreciation.

Question 17

What is a jumbo loan?

Accepted Answer

A jumbo loan is a mortgage above the annual conforming loan limit set by the FHFA. They typically require stronger credit, larger down payments, and more reserves than conforming loans.

Question 18

Can I refinance an FHA loan?

Accepted Answer

Yes, through an FHA Streamline (limited documentation, no appraisal required in many cases) or by refinancing into a conventional loan to drop FHA mortgage insurance once you have sufficient equity.

Question 19

What is a DSCR loan?

Accepted Answer

A Debt Service Coverage Ratio loan qualifies real estate investors based on the rental income of the subject property rather than personal income. It's commonly used for buy-and-hold rentals.

Question 20

What's the difference between pre-qualification and pre-approval?

Accepted Answer

Pre-qualification is a quick estimate based on stated information. Pre-approval involves verified credit, income, and assets and is far more credible to sellers and listing agents.

Question 21

Are there grants for first-time home buyers in Ohio?

Accepted Answer

Yes. The Ohio Housing Finance Agency offers down payment assistance and below-market-rate first-mortgage programs. Kentucky Housing Corporation offers similar programs in Northern Kentucky.

Question 22

Can I buy a home with a part-time job?

Accepted Answer

Often yes, particularly with a two-year history of part-time income or a combination of W-2 and additional income sources. John reviews your specific situation.

Question 23

Do I need to be a U.S. citizen to get a mortgage?

Accepted Answer

No. Permanent residents and many lawful non-permanent residents qualify for FHA, VA (where eligible), conventional, and ITIN-friendly portfolio loans.

Question 24

How is interest calculated on a mortgage?

Accepted Answer

Mortgage interest is calculated each month on the remaining principal balance. As you pay down principal, interest charges decrease and more of each payment goes to principal, this is called amortization.

Question 25

What is escrow?

Accepted Answer

An escrow account collects a portion of each monthly mortgage payment to pay property taxes and homeowners insurance when due. Most loans with less than 20% down require escrow.

Question 26

What are points?

Accepted Answer

Discount points are upfront fees paid to lower your interest rate. One point equals 1% of the loan amount. Whether points pay off depends on how long you keep the loan.

Question 27

Can I roll closing costs into my loan?

Accepted Answer

On a refinance, often yes. On a purchase, generally no, but seller-paid closing costs and lender credits can offset most or all out-of-pocket fees.

Question 28

What is a rate lock?

Accepted Answer

A rate lock is a written commitment from your lender to deliver a specific rate for a specific window, typically 30, 45, or 60 days, protecting you from market increases.

Question 29

Can I buy a home while on probation at my new job?

Accepted Answer

It depends on your offer letter, base vs. variable comp, and prior history in the field. Many programs allow it; some require completion of probation. John reviews case-by-case.

Question 30

What happens if my appraisal comes in low?

Accepted Answer

Options include renegotiating price, paying the appraisal gap in cash, requesting a value reconsideration, or canceling under appraisal contingency. We strategize the best move based on your situation.

Mortgage questions, answered.

Talk with John about your next step