Frequently Asked Questions

FHA mortgage insurance is required for all FHA loans. The insurance protects lenders from borrowers who default on their loans. However, it also requires borrowers to pay a premium, which can add to the cost of their loan. If you want to get rid of your FHA mortgage insurance, you’ll need to refinance to a conventional loan. You’ll need a credit score of 620 and 20% equity in your home to qualify. While this may seem like a high bar to clear, it’s actually easier than it sounds. There are several ways to improve your credit score, and there are many programs to help you come up with the down payment.
If you’re looking to improve your DSCR ratio, there are a few things you can do:
  • Try to increase your revenue and decrease your expenses. That may sound obvious, but your DSCR ratio is a measure of your ability to service your debt. Increasing your revenue without increasing your expenses will help.
  • Another option is to renegotiate the terms of your debt. If you can get a lower interest rate or extend the term of your loan, you’ll reduce your debt service requirements and improve your DSCR ratio.
  • Finally, try to increase the value of the collateral underlying your loan. If the value of your property increases, you’ll have more equity to cover any potential losses and your DSCR ratio will improve.
Whatever strategy you choose, improving your DSCR ratio is all about increasing your ability to service your debt.
To qualify for a DSCR mortgage loan, borrowers must have a strong financial history and should demonstrate an ability to repay the loan. Additionally, the property being purchased must be income-generating, which provides the lender with some security in case a borrower is unable to make payments.
To qualify for a DSCR loan, you will need to make a down payment of at least 20-25%. Additionally, your credit score must be 640 or higher to meet your lender’s DSCR requirement. Some lenders may also require that your property earn 120-150% of the monthly mortgage payment. If you are able to meet these qualifications, a DSCR loan can be an excellent way to finance your home purchase in Colorado.
To qualify for an FHA loan, borrowers must have a steady employment history, a good credit score, and a down payment of at least 3.5%. Additionally, borrowers must be able to show that they can afford the monthly mortgage payments. If you think you might qualify for an FHA loan, the best first step is to talk to a lender who can help you review your options.
If you’re considering refinancing your jumbo mortgage, it’s important to understand the process and what lenders will be looking for. One of the most important factors in determining whether you qualify for refinancing is your credit score. Lenders will also look at your employment history, income, and assets to determine whether you have the financial stability to make monthly payments. In addition, you’ll need to have at least 20% equity to qualify for a jumbo mortgage refinance. If you’re ready to take on the challenge of refinancing a jumbo mortgage, make sure to work with LBC Mortgage, and we will guide you on the process.
Debt Service Coverage Ratio (DSCR), or Debt Coverage Ratio, or DCR, is a metric that compares a property’s revenue to its debt obligations. Properties with a DSCR of more than 1.0, are considered profitable, whereas those with a DSCR below this point, are considered to be losing money.
Depending on the program and term of your mortgage, each month your payment will pay down the principal and interests. Typically, a bigger portion of your payment will go towards you interest, especially in early years of your term. Additionally, depending on details of your loan, portion of you payment may be applied to mortgage insurance, homeowner’s insurance, property tax and flood insurance if applicable.
That depends on your individual circumstances. If you’re planning on selling your home within a few years, for example, you may save money in the long run by taking out a no closing cost mortgage and paying the higher interest rate. On the other hand, if you plan on staying in your home for many years, you may be better off with a traditional mortgage and paying the upfront closing costs.
To qualify for a jumbo loan, you will need a higher credit score compared to a conforming loan. Usually, a credit score of at least 700 is required, but minimum score requirements may vary depending on the lender. The interest rate offered by lenders on a jumbo loan will be more favorable for borrowers with higher credit scores.

Yes, retirees can qualify for bank statement loans since they do not have a conventional stream of income that is accurately shown on their tax returns.

It’s important to note that loans for self-employed people can apply to a wide range of situations, including business owners, freelancers, gig economy employees, and realtors.

Yes, it is possible to refinance a first-time home buyer loan.