Question 1

What is a VA loan?

Accepted Answer

A VA loan is a mortgage backed by the Department of Veterans Affairs, available to veterans, active-duty service members, and eligible surviving spouses. VA loans offer significant benefits including $0 down payment, no PMI, and competitive interest rates.

Question 2

Who qualifies for a VA loan?

Accepted Answer

VA loan eligibility includes: veterans with 90+ days of wartime service or 181+ days of peacetime service, active-duty service members with 90+ days of service, National Guard/Reserve members with 6+ years of service, and surviving spouses of veterans who died in service or from service-connected disabilities.

Question 3

What are VA loan benefits?

Accepted Answer

Key VA loan benefits include: no down payment required, no private mortgage insurance (PMI), competitive interest rates typically lower than conventional loans, limited closing costs, no prepayment penalties, and the VA funding fee can be financed into the loan.

Question 4

What is the VA funding fee?

Accepted Answer

The VA funding fee is a one-time payment that helps offset the cost of the VA loan program to taxpayers. For first-time use with no down payment, the fee is 2.15% of the loan amount. Veterans with service-connected disabilities may be exempt from this fee.

Question 5

Can I use a VA loan more than once?

Accepted Answer

Yes, you can use your VA loan benefit multiple times. If you've paid off your previous VA loan, you can have your entitlement restored and use it again for a new home purchase. Some veterans may even have enough remaining entitlement to have two VA loans simultaneously.

Question 6

What credit score do I need for a VA loan?

Accepted Answer

The VA doesn't set a minimum credit score requirement, but most lenders require a score of 580-620. CMS Mortgage works with borrowers with scores as low as 580. Factors beyond credit score include debt-to-income ratio, residual income, and employment history.

Question 7

Are there VA loan limits?

Accepted Answer

For veterans with full entitlement, there are no VA loan limits as of 2020. You can borrow as much as a lender is willing to approve. For veterans with reduced entitlement (from a previous VA loan still in use), county loan limits may apply.

Question 8

Can I use a VA loan for an investment property?

Accepted Answer

VA loans are intended for primary residences only. However, you can purchase a multi-unit property (up to 4 units) with a VA loan if you live in one of the units. This allows you to collect rental income from the other units.

Question 9

What is an FHA loan?

Accepted Answer

An FHA loan is a mortgage insured by the Federal Housing Administration, designed to help first-time homebuyers and those with lower credit scores achieve homeownership. FHA loans feature low down payments (as low as 3.5%), flexible credit requirements, and competitive interest rates.

Question 10

What credit score do I need for an FHA loan?

Accepted Answer

FHA loans have flexible credit requirements. With a credit score of 580 or higher, you can qualify with a 3.5% down payment. With a score between 500-579, you may still qualify but will need a 10% down payment. CMS Mortgage works with borrowers across the credit spectrum.

Question 11

What is the minimum down payment for an FHA loan?

Accepted Answer

The minimum FHA loan down payment is 3.5% for borrowers with credit scores of 580 or higher. For scores between 500-579, a 10% down payment is required. The down payment can come from savings, gifts from family, down payment assistance programs, or employer contributions.

Question 12

What is FHA mortgage insurance (MIP)?

Accepted Answer

FHA mortgage insurance premium (MIP) protects lenders against default. It includes an upfront premium (1.75% of the loan amount, usually financed into the loan) and an annual premium (0.45%-1.05% depending on loan term and LTV) paid monthly.

Question 13

How long do I pay FHA mortgage insurance?

Accepted Answer

For FHA loans with less than 10% down, MIP is required for the life of the loan. With 10% or more down, MIP can be removed after 11 years. Many borrowers refinance to a conventional loan once they reach 20% equity to eliminate mortgage insurance entirely.

Question 14

What are FHA loan limits?

Accepted Answer

FHA loan limits vary by county and are updated annually. In 2026, the floor is $498,257 for single-family homes in most areas, with a ceiling of $1,149,825 in high-cost areas. Check your specific county limits as they can significantly impact your borrowing power.

Question 15

Can I get an FHA loan with bad credit?

Accepted Answer

Yes, FHA loans are specifically designed for borrowers with less-than-perfect credit. With a score as low as 500, you may still qualify (with 10% down). FHA lenders also consider compensating factors like steady employment, savings, and low debt-to-income ratio.

Question 16

What is an FHA 203k loan?

Accepted Answer

An FHA 203k loan combines a purchase or refinance with renovation financing in a single mortgage. It's ideal for buying fixer-uppers or renovating your current home. Both Standard 203k (major renovations over $35,000) and Limited 203k (minor improvements up to $35,000) options are available.

Question 17

What is a conventional loan?

Accepted Answer

A conventional loan is a mortgage not insured or guaranteed by the federal government. It's the most common type of home loan, offering competitive rates, flexible terms (10-30 years), and the ability to remove private mortgage insurance (PMI) once you reach 20% equity.

Question 18

What is the difference between conventional and FHA loans?

Accepted Answer

Conventional loans typically require higher credit scores (620+) and down payments (3-20%), but offer lower total costs over time due to removable PMI. FHA loans are more accessible with lower credit requirements (500+) and 3.5% down, but require mortgage insurance for longer periods.

Question 19

What credit score do I need for a conventional loan?

Accepted Answer

Most conventional loans require a minimum credit score of 620, though the best rates are available at 740+. With a score of 620-639, you may need a larger down payment. CMS Mortgage offers conventional loans to qualified borrowers across the credit spectrum.

Question 20

When can I remove PMI from a conventional loan?

Accepted Answer

You can request PMI removal once you reach 20% equity (80% loan-to-value). By law, lenders must automatically cancel PMI when you reach 22% equity. You can reach 20% equity through payments, home appreciation, or a combination of both.

Question 21

What are conforming loan limits?

Accepted Answer

Conforming loan limits are set annually by FHFA. In 2026, the limit is $806,500 for most areas and up to $1,209,750 in high-cost areas. Loans exceeding these limits are considered jumbo loans and may have different requirements and rates.

Question 22

What is a USDA loan?

Accepted Answer

A USDA loan is a zero-down-payment mortgage backed by the U.S. Department of Agriculture for homes in eligible rural and suburban areas. USDA loans offer competitive interest rates, no PMI requirement (instead a lower guarantee fee), and are designed to promote homeownership in less densely populated areas.

Question 23

Who qualifies for a USDA loan?

Accepted Answer

To qualify for a USDA loan: Your household income must be at or below 115% of the area median income, the property must be in a USDA-eligible rural area (many suburban areas qualify), you must be a U.S. citizen or permanent resident, and you must have a credit score of 640 or higher for most lenders.

Question 24

What areas are eligible for USDA loans?

Accepted Answer

USDA-eligible areas include most rural communities and many suburban neighborhoods. Surprisingly, about 97% of U.S. land area qualifies. You can check eligibility at the USDA website or ask CMS Mortgage to verify your property location.

Question 25

What is the USDA guarantee fee?

Accepted Answer

Instead of PMI, USDA loans have a guarantee fee: an upfront fee of 1% of the loan amount (can be financed) and an annual fee of 0.35% paid monthly. This is typically lower than FHA MIP or conventional PMI, making USDA loans very affordable.

Question 26

What is a jumbo loan?

Accepted Answer

A jumbo loan is a mortgage that exceeds conforming loan limits set by the Federal Housing Finance Agency. In 2026, this means loans above $806,500 in most areas (up to $1,209,750 in high-cost markets). Jumbo loans are used to finance luxury homes and properties in expensive real estate markets.

Question 27

What are the requirements for a jumbo loan?

Accepted Answer

Jumbo loan requirements are stricter: typically 700+ credit score (720+ for best rates), 10-20% down payment, debt-to-income ratio under 43%, significant cash reserves (6-12 months of payments), and thorough documentation of income and assets.

Question 28

Are jumbo loan rates higher than conventional?

Accepted Answer

Historically, jumbo rates were higher, but today they are often comparable to or even lower than conforming rates for well-qualified borrowers. This is because jumbo borrowers typically have excellent credit, substantial assets, and low default risk.

Question 29

How much down payment do I need for a jumbo loan?

Accepted Answer

Jumbo loans typically require 10-20% down payment, though some programs offer as low as 5-10% down for highly qualified borrowers. A 20% down payment avoids PMI and often secures better interest rates.

Question 30

What is mortgage refinancing?

Accepted Answer

Mortgage refinancing replaces your current home loan with a new one, typically to lower your interest rate, reduce monthly payments, shorten your loan term, or access home equity (cash-out refinance). Refinancing can save you thousands over the life of your loan.

Question 31

When should I refinance my mortgage?

Accepted Answer

Consider refinancing when: rates drop 0.5-1% or more below your current rate, you want to eliminate PMI after reaching 20% equity, you need to switch from adjustable to fixed rate, or you want to access equity for home improvements or debt consolidation.

Question 32

What is a cash-out refinance?

Accepted Answer

A cash-out refinance lets you borrow more than you owe and receive the difference in cash. For example, if you owe $200,000 on a home worth $350,000, you could refinance for $280,000 and receive $80,000 in cash (minus closing costs) for renovations, debt payoff, or other needs.

Question 33

How much does it cost to refinance?

Accepted Answer

Refinance closing costs typically range from 2-5% of the loan amount. On a $300,000 loan, expect $6,000-$15,000 in costs including appraisal, title insurance, and lender fees. Many borrowers roll these costs into the new loan or accept a slightly higher rate for no-cost refinancing.

Mortgage Questions? We've Got Answers.

Top Mortgage Questions, Answered

What is a conventional loan?

What is an FHA loan?

What is a VA loan?

What is mortgage refinancing?

Conventional Loans

FHA Loans

VA Loans

USDA Loans

Jumbo Loans

Refinancing

Still Have Questions?

Mortgage Questions? We've Got Answers.

Top Mortgage Questions, Answered

What is a conventional loan?

What is an FHA loan?

What is a VA loan?

What is mortgage refinancing?

Conventional Loans

FHA Loans

VA Loans

USDA Loans

Jumbo Loans

Refinancing

Still Have Questions?