The questions we answer every week

Pre-qualification is a conversation and a soft credit pull that tells you the likely program and price range. Pre-approval is a full file: credit, income and asset documents run through automated underwriting, producing a letter with a defined purchase price and a named underwriter. In this market, listing agents take the second seriously and largely ignore the first.

Our median on conventional purchases is 12 business days from complete file to clear-to-close, and 24 calendar days contract to settlement (sample figures). FHA runs about two days longer, USDA runs 35 to 45 calendar days because of the agency commitment step, and jumbo runs around 28 business days.

Two years of W-2s or tax returns, 30 days of pay stubs, two months of statements for every account used for down payment or reserves, photo identification, and the fully executed purchase contract once you have one. Self-employed borrowers add business returns, all K-1s and a current profit and loss statement.

A mortgage credit pull is a hard inquiry worth a few points, and multiple mortgage inquiries inside a 45-day window are scored as a single event. Shop the same week rather than across three months, and do not open new accounts or finance a car between application and closing.

Yes, and roughly a third of our volume is self-employed. The standard route is two years of personal and business returns with income averaged. Where write-offs make that unworkable, we have bank statement programs using 12 or 24 months of deposits, and asset depletion for borrowers whose wealth sits in portfolios.

Three percent on a conventional loan if at least one borrower is a first-time buyer, 3.5% on FHA, and nothing at all on VA or USDA if you are eligible. Twenty percent avoids mortgage insurance but is not a requirement. On a $400,000 Philadelphia purchase that is the difference between $12,000 and $80,000.

Below about 660, FHA usually wins on monthly cost because conventional PMI pricing is punishing in that band. Above about 700, conventional almost always wins because the PMI is cheaper and, crucially, cancellable. Between the two we run both and show you the five-year cost of each.

For 2026 the baseline one-unit conforming limit across Philadelphia, Montgomery, Bucks, Delaware and Chester counties is $832,750 (sample figure). Above that the loan is jumbo, priced by portfolio investors rather than the agencies. The FHA limit for the Philadelphia MSA is considerably lower at $524,225.

Yes, and it is one of the best structures available in this city. A two-unit primary residence needs 15% down conventionally, three and four units need 25%, and FHA allows 3.5% on all of them. Rental income from the other units counts, generally at 75% of market rent from a Form 1007 schedule.

Yes. The building must pass project review: investor concentration, budget reserves, pending litigation and insurance adequacy. We keep our own questionnaire history on the larger Center City buildings, so we often know the answer before the association replies.

Divide the cost by the monthly saving to get the break-even in months. On our current sample grid, one point on a $400,000 loan costs $4,000 and saves $64 a month, which is 62 months. If you will hold the loan longer than that and are not likely to refinance, it works. If not, it does not.

Once you are under contract with a settlement date you believe. Our default is a 45-day lock at 0.125 points, which covers most Philadelphia contracts. Locking earlier costs more; locking later risks the market. You may lock before the appraisal returns, but a value surprise can change the pricing tier.

You may use your one free float-down. If the market improves by 0.250% or more, we relock at the new market rate less 0.125%, requested at least ten calendar days before settlement. It is written into our lock policy rather than granted case by case.

The rate determines your principal and interest payment. The APR expresses the rate plus origination, underwriting, credit, flood, tax service and mortgage insurance as a single annualized figure. FHA shows a wide gap between the two because the 1.75% upfront premium is included.

Sometimes, not always, and we will not pretend otherwise. Our flat $1,095 origination fee means we usually win on total cost at smaller loan amounts and on files that need real underwriting. If a competitor quotes materially lower, send us their Loan Estimate and we will tell you honestly whether it is genuine.

On a $400,000 purchase with a $320,000 loan, roughly $12,463 (sample figure). The largest single item is the 4.278% combined transfer tax, customarily split with the seller. Our lender fees are $1,253 of the total. Every line is itemized on our closing cost page.

You may request cancellation in writing at 80% of the original value, and the servicer must terminate automatically at 78% based on the original amortization schedule. Separately, Fannie Mae allows cancellation on a current appraisal at 75% loan-to-value after two years, or 80% after five, which in an appreciating market is usually far sooner.

Because FHA priced it that way. When your loan-to-value at origination is above 90%, the annual premium runs for the life of the loan. At 90% or below it drops after 11 years. The exit is a conventional refinance once you reach 80% loan-to-value, which is why we hand every FHA borrower a dated schedule at closing.

Within limits. Conventional allows 3% at under 10% down, 6% between 10% and 25%, and 9% above. FHA and VA allow up to 6%, and USDA allows 6%. These are ceilings on what may be credited, and the credit cannot exceed your actual costs.

No. Our origination and underwriting fee is $1,095, flat, charged at closing regardless of loan size. There is no application fee, no processing fee and no commitment fee. Third-party and government charges are set by others and itemized separately.

A rental property loan qualified on the property's income rather than yours. Debt service coverage ratio is gross monthly rent divided by PITIA: principal, interest, taxes, insurance and any association dues. A $2,400 rent against a $2,000 PITIA is 1.20. There is no personal debt-to-income calculation and no tax returns.

Agency guidelines cap you at ten financed properties. DSCR does not cap you at all, which is why investors beyond their tenth door end up here. Blanket portfolio loans take five to forty properties under a single note.

Yes, on every investor product, at no additional charge. Members provide a personal guaranty and title goes into the entity at closing. Taking title personally and transferring later can trigger a due-on-sale clause, so we would rather do it correctly the first time.

Yes, with a documented twelve-month operating history from platform statements or a property manager's report. We underwrite to a trailing twelve-month average rather than peak season. Without that history we use long-term market rent from the appraiser's Form 1007 instead.

Our standard DSCR structure carries a 5/4/3/2/1 step-down, meaning 5% of the balance in year one falling to 1% in year five. It can be bought out in points at closing. If your holding period is under three years, price that buyout before you sign rather than after.