Last reviewed: September 20, 2026
Quick Answer
What are the most common mortgage questions in California?
Cascada Mortgage Advisors, Inc. (NMLS #2470941, CA DRE #02206556), founded by Omar Michel (NMLS #398944, CA DRE #02131389), is a licensed mortgage broker serving California homebuyers that arranges financing through a network of 100+ wholesale lenders — not as a direct lender. California homebuyers frequently ask about minimum credit scores (580 for FHA, 620 for conventional), down payment requirements (0–20%), current interest rates, how to get pre-approved, and the differences between fixed-rate and adjustable-rate mortgages. The firm answers all of these and more.
— Cascada Mortgage Advisors, Inc.
Frequently Asked Questions
Straight answers about self-employed financing, reverse mortgages, conventional loans, refinancing, rates, closing costs, FHA, and VA loans.
How to use this page
The questions below are grouped by mortgage need so you can find a direct answer quickly. If you need pricing specific to your scenario — credit tier, property type, occupancy, and county — the answers here won't replace a written Loan Estimate. Book a free 20-minute consultation or start with a homebuyer pre-approval or refinance analysis.
All figures reflect 2026 loan limits and California-specific guidance. Rates change daily — see Today's Rates for current pricing across FHA, VA, conventional, jumbo, and Non-QM programs.
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Common Mortgage Questions
Credit scores, down payments, loan limits, closing costs, rates, and other questions California homebuyers ask most.
•What credit score do I need to buy a house in California in 2026?
The minimum credit score depends on the loan program. FHA loans require a minimum 580 with 3.5% down, or 500 with 10% down. Conventional loans typically require 620 to 640 for automated approval, with 740+ accessing the best pricing. VA loans have no VA-mandated minimum — lenders apply overlays typically starting at 580 to 620. Jumbo and Non-QM loans typically require 680 to 720+. Cascada Mortgage Advisors, Inc. (NMLS #2470941, CA DRE #02206556) works with 100+ wholesale lenders and can identify which programs fit your specific credit profile.
•How much down payment do I need to buy a home in San Diego?
Down payment requirements vary by loan type. VA loans require zero down payment for eligible veterans and active duty service members with full entitlement — with no county loan limit in 2026. FHA loans require 3.5% down with a 580+ credit score. Conventional loans allow as little as 3% to 5% down for primary residences. Jumbo loans typically require 10% to 20% down. On San Diego's 2026 median home price, a 3.5% FHA down payment is significantly less than a 20% conventional down payment — the right program depends on your situation.
•What is the difference between a mortgage broker and a bank?
A mortgage broker arranges loans through multiple wholesale lenders — comparing rates, programs, and guidelines across the market. A bank or direct lender offers only its own products. As a broker, Cascada Mortgage Advisors, Inc. (NMLS #2470941) submits each borrower's scenario to multiple lenders and returns the most competitive terms available — rather than steering you toward a single institution's products. Brokers typically have access to Non-QM, jumbo, and specialty programs that retail banks do not offer directly.
•How long does it take to get a mortgage in California?
A standard conventional or FHA purchase loan typically closes in 21 to 30 days from completed application to funding. VA loans typically close in 30 to 45 days. Jumbo loans vary by lender — typically 30 to 45 days. Non-QM loans may take 30 to 45 days depending on documentation complexity. A VA IRRRL streamline refinance can close in approximately 30 days. Timeline depends on how quickly documentation is submitted, appraisal turnaround, and title company scheduling.
•What is PMI and how do I avoid it?
PMI (Private Mortgage Insurance) is required on conventional loans when the down payment is less than 20% of the purchase price. It protects the lender — not the borrower — and adds to the monthly payment. PMI can be avoided by putting 20% or more down, using a VA loan (which never requires PMI regardless of down payment), or structuring a piggyback loan. PMI on conventional loans can be cancelled once the loan balance reaches 80% of the original appraised value — unlike FHA mortgage insurance, which typically remains for the life of the loan.
•What is a debt-to-income ratio and how does it affect my mortgage?
Debt-to-income ratio (DTI) is your total monthly debt obligations divided by your gross monthly income. It is one of the primary qualifying factors for most mortgage programs. Conventional loans typically allow a maximum DTI of 43% to 50% with strong compensating factors. FHA allows up to 57% in some cases. VA loans use a combination of DTI and residual income. Non-QM programs may calculate DTI differently or skip it entirely — DSCR loans, for example, use the property's rental income rather than the borrower's personal DTI.
•Can I get a mortgage if I am self-employed in California?
Yes. Self-employed borrowers have multiple mortgage options in California. Conventional loans require two years of self-employment history documented through tax returns. Bank statement loans qualify using 12 to 24 months of deposits rather than tax returns — no W-2s required. P&L only loans use a CPA-prepared profit and loss statement. Asset depletion loans qualify based on liquid assets. Self-employed borrowers who are declined by conventional lenders often qualify through Non-QM programs. Cascada Mortgage Advisors, Inc. (NMLS #2470941) specializes in mortgage solutions for self-employed borrowers throughout San Diego and Los Angeles.
•What is the conforming loan limit in San Diego County in 2026?
San Diego County's 2026 conforming loan limit for a one-unit primary residence is $1,104,000 (FHFA). Loans at or below this limit are eligible for conventional Fannie Mae and Freddie Mac programs. Loans above $1,104,000 require jumbo financing with different underwriting requirements and typically higher down payment and credit score thresholds. Los Angeles County's 2026 conforming limit is $1,209,750 (FHFA). These limits are set annually by FHFA based on median home prices.
•What closing costs should I expect when buying a home in California?
California home buyers typically pay closing costs of 1% to 3% of the purchase price in addition to the down payment. Common costs include loan origination fees, appraisal ($500 to $900), title insurance and settlement fees, escrow fees, recording fees, and prepaid items such as homeowners insurance and property tax reserves. VA loans limit certain fees and allow sellers to pay closing costs — reducing out-of-pocket expenses significantly. Closing costs can be negotiated with the seller or in some cases financed into the loan.
•What is the difference between pre-qualification and pre-approval?
Pre-qualification is an informal estimate of how much you might borrow based on self-reported income and debt figures — no documentation is verified. Pre-approval is a formal review where the lender verifies income, assets, employment, and credit, resulting in a conditional commitment to lend up to a specific amount. In San Diego's competitive market, sellers and listing agents typically require a pre-approval letter — not just a pre-qualification — before accepting an offer. A full underwritten pre-approval (credit approved before finding a property) is the strongest position.
•Should I get a 15-year or 30-year mortgage?
A 30-year mortgage has lower monthly payments and more cash flow flexibility. A 15-year mortgage has higher monthly payments but a lower interest rate and significantly less total interest paid over the life of the loan. In San Diego, where home prices are high and mortgage payments are substantial, most borrowers choose 30-year terms for the lower payment — with the option to make extra principal payments when cash flow allows. The Payoff Calculator at cascadamortgageadvisors.com/payoff-calculator shows exactly how extra payments affect your payoff date and total interest.
•How do mortgage rates work and what affects my rate?
Mortgage rates are set by individual lenders based on bond market conditions, primarily the 10-year Treasury yield. Your individual rate depends on credit score (higher score = lower rate), loan-to-value ratio (more equity = lower rate), loan type (VA and conventional price differently), loan size, and whether you pay discount points to buy down the rate. As a mortgage broker, Cascada Mortgage Advisors, Inc. (NMLS #2470941) submits each scenario to multiple wholesale lenders and returns the most competitive rate available — rather than offering a single institution's rate sheet.
Self-Employed & Non-QM
Alternative income documentation for business owners, contractors, investors, and asset-rich borrowers.
•Can I get a mortgage if I'm self-employed?
Yes. Self-employed borrowers may qualify with tax returns or alternative documentation such as bank statements, a profit-and-loss statement, 1099 income, or eligible assets; program details vary by lender.
•What is a Non-QM loan?
A Non-QM loan uses underwriting methods outside standard qualified-mortgage guidelines, often because income is documented differently. It can serve creditworthy borrowers with bank-statement, P&L, 1099, rental, or asset-based income; details vary by lender.
•How do bank statement loans calculate income?
A lender generally reviews eligible deposits over a required period and applies an expense treatment when business statements are used. The statement period, excluded deposits, and expense calculation vary by lender.
•How does a P&L-only mortgage document income?
A P&L-only program may use a current profit-and-loss statement prepared to the selected lender's standards. The lender determines the acceptable preparer, reporting period, supporting records, and qualifying adjustments.
•How does a 1099 income mortgage document earnings?
A 1099 program may evaluate documented 1099 earnings and apply an expense treatment instead of relying solely on tax-return net income. Required history and calculations vary by lender.
•What is a DSCR loan?
A DSCR loan evaluates an investment property's rental income against its housing expense rather than using the borrower's employment income. Property, credit, reserve, and ratio requirements vary by lender.
•Can assets be used as mortgage qualifying income?
Some asset-utilization programs convert eligible liquid assets into a calculated monthly income amount. Eligible accounts, valuation discounts, depletion periods, and reserve rules vary by lender.
•Are Non-QM rates and prepayment terms different?
Non-QM pricing can differ from conventional financing because documentation and risk are evaluated differently. Prepayment terms vary by program and lender, so review the note and loan disclosures before closing.
Reverse Mortgages
HECM eligibility, proceeds, responsibilities, heirs, and purchase options.
•How does a reverse mortgage work for California homeowners?
A reverse mortgage lets an eligible homeowner access home equity without required monthly principal-and-interest payments while the loan remains in good standing. The balance becomes due after a maturity event such as sale, permanent move-out, or the last borrower’s death.
•Who is eligible for an FHA-insured HECM?
At least one borrower must generally be age 62 or older, occupy the property as a principal residence, and meet financial-assessment and property requirements. The borrower must also complete counseling with a HUD-approved agency.
•How can reverse mortgage proceeds be received?
Depending on the program and transaction, proceeds may be available through a line of credit, monthly advances, a lump sum, or a combination. Available options and amounts depend on age, home value, existing liens, rates, and program rules.
•Do I keep ownership of my home with a reverse mortgage?
Yes. The borrower remains on title and must continue paying property taxes, homeowners insurance, applicable HOA charges, and property maintenance costs.
•What happens to a reverse mortgage when the borrower dies?
The loan generally becomes due and payable after the last borrower dies. Heirs may repay the balance, refinance, sell the home, or follow the servicer’s process for other available options.
•Can a reverse mortgage be used to buy a home?
Yes. A HECM for Purchase can combine a borrower’s funds with reverse mortgage proceeds to buy a principal residence without required monthly principal-and-interest payments.
Conventional & Refinance
Purchase, second-home, refinance, conforming-limit, and PMI questions.
•What is the 2026 conforming loan limit in San Diego County?
The 2026 high-balance conforming limit for a one-unit property in San Diego County is $1,104,000. A loan above that amount is generally jumbo rather than conforming.
•When is a conventional loan the right tool?
A conventional loan can fit move-up purchases, second homes, and refinances when the borrower meets Fannie Mae or Freddie Mac requirements. It offers broad property eligibility and cancellable PMI when applicable.
•What is a rate-and-term refinance?
A rate-and-term refinance replaces an existing mortgage primarily to change the interest rate, loan term, or loan structure without taking substantial cash out. Compare the payment change and closing costs against the expected time you will keep the loan.
•How does a conventional cash-out refinance work?
A cash-out refinance replaces the current mortgage with a larger loan and returns part of the equity as cash at closing. Available proceeds depend on property value, current liens, occupancy, credit, and program limits.
•Can I finance a second home with a conventional loan?
Yes. Conventional financing can be used for an eligible second home when occupancy, property, credit, down payment, and reserve requirements are met.
•How does conventional PMI work?
Private mortgage insurance may be required when a conventional loan exceeds 80% loan-to-value. Cancellation rules depend on payment history, property value, investor requirements, and federal law.
Rates & Closing Costs
Rate locks, discount points, closing costs, escrow accounts, and title insurance.
•What are closing costs and how much should I expect to pay?
Closing costs often include lender charges, appraisal, title, escrow, recording, prepaid taxes, and insurance. The amount varies by loan and property, and the Loan Estimate provides the transaction-specific breakdown.
•What is an impound or escrow account?
An impound account collects portions of property taxes and homeowners insurance with the monthly mortgage payment. Whether it is required depends on the loan program, occupancy, lender, and loan-to-value.
•What is the difference between a rate lock and a float-down option?
A rate lock holds specified loan pricing for a defined period, subject to its terms and an unchanged application. A float-down may permit revised pricing after a market improvement, but availability, cost, and conditions vary by lender.
•How do discount points work?
One discount point equals 1% of the loan amount and is paid for a pricing adjustment under the selected offer. The rate effect is not fixed, so compare the cost with projected monthly savings and your expected holding period.
•How long is title insurance valid and who pays for it in California?
A lender’s title policy generally remains tied to the covered loan, while an owner’s policy generally protects the covered owner under its terms. Payment customs vary by area and are negotiable in the purchase contract.
FHA
FHA structure, credit, down payment, and mortgage insurance basics.
•What is an FHA loan?
An FHA loan is a mortgage insured by the Federal Housing Administration and offered by approved lenders. It requires mortgage insurance and is limited to eligible principal residences and program loan limits.
•What credit score and down payment does FHA require?
FHA permits 3.5% down with a qualifying score of at least 580 and 10% down for qualifying scores from 500 through 579. Lenders may apply additional requirements beyond FHA minimums.
VA
VA eligibility, down payment, mortgage insurance, and funding-fee basics.
•Who is eligible for a VA loan?
VA loans serve eligible veterans, active-duty service members, qualifying National Guard or Reserve members, and some surviving spouses. The Department of Veterans Affairs determines entitlement through a Certificate of Eligibility.
•Do VA loans require a down payment or mortgage insurance?
Eligible borrowers with sufficient entitlement can often obtain VA financing without a down payment, subject to property value and lender approval. VA loans do not require monthly mortgage insurance, though a funding fee may apply unless the borrower is exempt.
Mortgage Glossary
Terms you'll see on your Loan Estimate, Closing Disclosure, and rate sheets. Understanding these is the difference between comparing offers on price versus comparing them on structure.
Related Resources
Didn't find your answer?
Every California borrower's situation is different. Talk directly with Omar Michel — no obligation, no cost — and get answers specific to your credit, income, and property.