Mortgage FAQ: Your Home Loan Questions Answered

Most loan programs require a minimum credit score of 580–620. FHA loans accept scores as low as 580 with 3.5% down, while conventional loans typically need 620 or higher. A higher score generally earns you a better interest rate and lower monthly payment.

Lenders typically recommend keeping your total monthly housing costs below 28–36% of your gross monthly income. Your purchase power depends on your income, debts, credit score, and down payment. Use a mortgage calculator to get a personalized estimate of what you can comfortably afford.

Pre-approval is a lender’s written commitment stating how much you can borrow, based on a review of your income, assets, and credit. It gives you a competitive edge when making offers because sellers know you’re a qualified buyer. Pre-approval is different from pre-qualification, which is only an informal estimate. Get pre-approved today.

From application to closing, the mortgage process typically takes 30–45 days. Timelines depend on the loan type, how quickly you submit documentation, and the appraisal and title process. Being responsive with your paperwork helps keep things on schedule.

FHA loans are government-insured, accept lower credit scores (580+), and require just 3.5% down, but they come with mandatory mortgage insurance for the life of the loan. Conventional loans typically require a 620+ credit score and 3–5% down, but let you drop PMI once you reach 20% equity.

VA loans are available to active-duty service members, veterans, and eligible surviving spouses. They offer zero down payment, no PMI, and competitive rates. You’ll need a Certificate of Eligibility (COE) to prove your service history.

USDA loans are zero-down mortgages for homes in eligible rural and suburban areas, backed by the U.S. Department of Agriculture. They’re designed for moderate-income borrowers and offer low interest rates. Many areas outside major Utah cities qualify for USDA financing.

A jumbo loan exceeds the conforming loan limit set by the FHFA—currently $766,550 in most U.S. counties. Jumbo loans are used for higher-priced properties and typically require stronger credit, larger reserves, and a bigger down payment than conforming loans.

Down payment requirements vary by loan type: FHA requires 3.5%, conventional loans start at 3%, and VA and USDA loans offer 0% down. Utah also has down payment assistance programs that can cover part or all of your down payment.

PMI is insurance your lender requires when your down payment is less than 20% on a conventional loan. It protects the lender—not you—if you default. PMI typically costs 0.3–1.5% of the loan amount per year and can be removed once you reach 20% equity in your home.

Closing costs include lender fees, appraisal, title insurance, escrow setup, and prepaid taxes and insurance. They typically run 2–5% of the loan amount. Your Loan Estimate will itemize every fee so there are no surprises at the closing table.

Yes. Utah Housing Corporation (UHC) offers down payment assistance through programs like FirstHome and HomeAgain, which provide a second mortgage to cover your down payment and closing costs. Income limits and purchase price caps apply, but many first-time and repeat buyers qualify.

Mortgage rates are influenced by the broader economy, the Federal Reserve’s policy, inflation, and bond market yields. Your individual rate also depends on your credit score, down payment, loan type, and loan term. Rates change daily, so locking in at the right time matters.

A fixed-rate mortgage keeps your interest rate and payment the same for the entire loan term, offering stability. An adjustable-rate mortgage (ARM) starts with a lower rate that can change after the initial fixed period. Fixed rates are best if you plan to stay long-term; ARMs can save money if you expect to move or refinance within a few years.

Yes. Discount points let you pay an upfront fee at closing to lower your interest rate. One point costs 1% of the loan amount and typically reduces your rate by about 0.25%. Buying points makes sense if you plan to keep the loan long enough for the monthly savings to exceed the upfront cost.

An escrow account is managed by your loan servicer to collect and pay property taxes and homeowner’s insurance on your behalf. A portion of each monthly mortgage payment goes into escrow so these bills are paid automatically. Most lenders require escrow, especially if your down payment is below 20%.

Refinancing generally makes sense when current rates are at least 0.5–1% lower than your existing rate, when you want to switch from an ARM to a fixed rate, or when you need to change your loan term. You’ll want to make sure the monthly savings outweigh the closing costs over the time you plan to stay in the home.

A cash-out refinance replaces your existing mortgage with a larger loan, letting you pocket the difference in cash. Homeowners commonly use it to fund renovations, consolidate debt, or cover major expenses. You’ll need sufficient equity—typically at least 20% remaining after the cash-out. Learn more about refinancing in Utah.

A streamline refinance is a simplified refinance available for FHA, VA, and USDA loans. It requires minimal documentation, often no appraisal, and closes faster than a standard refinance. The main requirement is that the refinance must result in a tangible benefit, such as a lower rate or payment.

Utah Housing Corporation’s FirstHome program offers below-market interest rates plus down payment assistance for first-time buyers. The DPA comes as a second mortgage with no monthly payments. Income and purchase price limits apply, and you’ll need to complete a homebuyer education course.

The Score loan is Utah Housing’s program for repeat buyers or those who don’t qualify for FirstHome. It still offers competitive rates and down payment assistance, just with slightly different terms. Felix can compare both programs side by side to see which saves you more.

Yes. Utah County offers up to $40,000 in down payment assistance at 0% interest with deferred payments. This can be combined with Utah Housing programs and FHA or conventional financing to significantly reduce your out-of-pocket costs.

Many areas outside the I-15 corridor qualify for USDA loans, including parts of Tooele County, Box Elder County, Cache Valley, and southern Utah County communities like Payson and Salem. Eligibility is based on the specific property address—Felix can check any address for you.

In many cases, yes. For example, you can combine a Utah Housing FirstHome loan with Utah County’s $40,000 DPA and potentially an employer assistance program. The key is that the programs need to be compatible with each other and your loan type. Felix specializes in layering programs to minimize your costs.

Yes. FHA loans accept credit scores as low as 580 with 3.5% down, and some lenders go to 500 with 10% down. If your score is below 580, Felix can help you build a plan to improve it—many buyers raise their score 40–60 points in just a few months with targeted strategies.

There’s no fixed income requirement—qualification is based on your debt-to-income ratio (DTI). Most programs allow a DTI up to 45–50%, meaning your total monthly debts (including the new mortgage) can be up to half your gross monthly income. Your specific number depends on the loan type and your overall financial picture.

Yes. FHA, VA, USDA, and conventional loans all allow gift funds for the down payment. The gift must come from an eligible donor (typically a family member) and be properly documented with a gift letter. The lender will verify the donor’s ability to give and confirm no repayment is expected.

Yes. Self-employed borrowers typically need two years of tax returns and a year-to-date profit and loss statement. Lenders average your net income over the two years. If your tax returns show lower income due to write-offs, bank statement loan programs may be an option—they use your deposits instead of tax returns to calculate income.

Student loans are factored into your DTI ratio. If you’re on an income-driven repayment plan, lenders may use 0.5–1% of the loan balance as your monthly payment for qualification purposes (the exact rule depends on the loan program). Felix can run the numbers with your specific student loan situation.

You’ll typically need: two months of bank statements, two months of pay stubs, two years of W-2s (or tax returns if self-employed), a valid photo ID, and your Social Security number for the credit pull. If you have other income sources (rental income, retirement, etc.), bring documentation for those too.

Once pre-approved, you shop for homes within your budget with your real estate agent. When you find one and go under contract, your file moves to processing: the lender orders an appraisal, verifies your employment and financials, and the underwriter reviews everything. Then you get a “clear to close,” sign the final documents, and get your keys.

An appraisal is an independent assessment of the home’s market value, ordered by the lender. It protects both you and the lender from overpaying. If the appraisal comes in below the purchase price, you can renegotiate with the seller, bring extra cash to cover the gap, or walk away (depending on your contract terms).

“Clear to close” means the underwriter has approved your loan and all conditions are satisfied. At closing, you’ll sign the promissory note, deed of trust, and other legal documents. You’ll bring a cashier’s check or wire the remaining funds. Once everything is recorded with the county, you get the keys to your new home.

Yes. Felix Vivanco is completely bilingual in English and Spanish. He provides the entire mortgage experience in both languages—from the initial consultation and pre-approval through closing. Visit the Spanish site or call (801) 919-8110.

Felix is licensed in Utah and serves borrowers across the entire state. He specializes in the Wasatch Front from Ogden to Payson, including Salt Lake City, Provo, Lehi, Orem, and 60+ communities. He also serves Park City, St. George, Logan, Cedar City, and everywhere in between.

You can start your application online in minutes, book a free consultation, or call (801) 919-8110. Felix responds quickly and will walk you through your options with no pressure and no obligation.

No. Consultations and pre-approvals are completely free. There’s no obligation and no impact on your credit score until you’re ready to move forward with a full application. Felix is here to help you understand your options before you commit to anything.