Mortgage Intelligence Hub
MORTGAGE FAQs
The ultimate guide to navigating the Texas mortgage market. Precision facts delivered directly by Mike Durr.
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All Questions
Purchase
Refinance
VA Specialist
General
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Purchase Strategy
What is the very first step I should take to buy a home?
Getting pre-approved is step one. It defines your budget and shows sellers you are a serious, qualified buyer.
How much down payment do I really need in Texas?
Programs start as low as 3% for Conventional or 3.5% for FHA. You don't always need 20%.
What are "Closing Costs" exactly?
These include lender fees, title insurance, government recording fees, and initial tax/insurance escrows.
What is Earnest Money vs. Down Payment?
Earnest money is a small "good faith" deposit at contract; the down payment is your total cash at the final closing.
What does "DTI" mean and why does it matter?
Debt-to-Income (DTI) compares your monthly debt to your gross income. Lenders use it to judge affordability.
How long does the appraisal take?
Typically 7–10 days. It ensures the home's value justifies the loan amount.
What is PMI?
Private Mortgage Insurance protects the lender if you put down less than 20%. It can be removed later.
Can I use gift funds?
Yes, family gifts are allowed with a signed Gift Letter and proof of transfer.
Is a home inspection mandatory?
Not by the lender, but it is highly recommended to protect your investment.
What is a rate lock?
A guarantee that your interest rate won't change before closing for a set period (usually 30-45 days).
Refinance Strategy
When is it actually worth it to refinance?
Generally, if you can drop your rate by 0.75% or more, or need to consolidate high-interest debt.
What is a Cash-Out Refinance?
Replacing your current loan with a larger one and taking the difference in cash (up to 80% equity).
How long must I wait to refinance?
Standard seasoning is 6 months after your original purchase closing date.
Can I remove PMI with a refi?
Yes! If your home's value increased and you have 20% equity, you can eliminate PMI fees.
What is a Rate-and-Term Refinance?
Changing your interest rate or loan term (e.g., 30yr to 15yr) without taking any cash out.
What is a HELOC?
A Home Equity Line of Credit acts like a credit card tied to your equity. Only pay interest on what you use.
Is a new appraisal required?
Usually yes, though "Streamline" programs for VA or FHA can often skip this step.
Can I roll costs into the loan?
Yes, most refi programs allow you to roll closing costs into the balance to minimize out-of-pocket cash.
Can I refinance an investment property?
Yes, though the guidelines and interest rates are typically higher than for a primary residence.
What is the DTI for a refi?
Guidelines vary, but we typically look for a DTI under 43–50% depending on the loan program.
VA Loan Specialist
Is a VA loan really 0% down?
Yes! Qualified Veterans and Active Duty can buy with zero money down and no monthly mortgage insurance.
What is the VA Funding Fee?
A one-time fee paid to the VA to sustain the program. Disabled Veterans are often exempt.
Can I use my VA loan more than once?
Yes! You can reuse your entitlement as many times as you like throughout your lifetime.
What is a COE?
Certificate of Eligibility. It proves to the lender that you meet military service requirements. Mike can pull this for you.
What are VA "MPRs"?
Minimum Property Requirements. The VA ensures a home is safe, sound, and sanitary before approving the loan.
What is a VA IRRRL?
Streamline Refinance. A low-paperwork way for Veterans to drop their interest rate quickly.
Does VA have a loan limit?
No. For Veterans with full entitlement, there is no set loan limit from the VA.
Can I have two VA loans?
Yes, depending on your remaining entitlement and the locations of the homes.
Can I have a co-signer?
Yes, but if they aren't a spouse or another Veteran, a down payment may be required.
What is "Tidewater"?
A notice from a VA appraiser that the home's value might come in low, giving us 48 hours to provide comps.
General Advice
What credit score is needed for a mortgage?
We work with scores as low as 580 for FHA, but a 720+ score will always yield the absolute lowest interest rates.
Should I pay off debt before applying?
Not necessarily. Sometimes keeping cash for your down payment is smarter. Talk to Mike before making big moves.
How long does closing take?
Standard is 21–30 days. Mike's team often delivers "Clear to Close" in 17 days or less.
What is an Escrow Account?
A forced savings account where the lender collects taxes/insurance monthly to pay them for you annually.
Should I buy down the rate?
Buying points makes sense if you plan to keep the home for 5+ years. We'll do the math for you.
What is Fixed-Rate vs. ARM?
Fixed stays the same for 30 years; ARM starts low but can change after a set period (usually 5 or 7 years).
Can I buy after a bankruptcy?
Yes, but there is usually a 2–4 year waiting period depending on the specific loan program.
What is a Bank Statement loan?
A program for self-employed buyers where we use deposits instead of tax returns to prove income.
What is a Gift Letter?
A document signed by a donor stating they are giving you money for a home and do not expect repayment.
How often do rates change?
Mortgage rates can change daily (sometimes multiple times) based on the bond market and economic news.