Frequently Asked Mortgage Questions
Do you have questions? We can help! You will find the answers to several frequently asked mortgage questions below.
A bridge loan is a short-term financing solution used to acquire or stabilize a property before refinancing into a long-term loan or selling it.
A fix and flip loan is a short-term loan used to purchase, renovate, and resell a property for profit. These loans often include funding for both acquisition and rehab.
Bridge loans are short-term and designed for transitional properties, while term loans are long-term financing solutions for stabilized, income-producing assets.
Non-QM (Non-Qualified Mortgage) loans do not follow traditional lending guidelines. They offer more flexible qualification options for borrowers who don’t fit standard criteria.
A stabilized property is one that is fully renovated (if needed), occupied or rentable, and generating consistent income.
A value-add property is one that needs improvements or operational changes to increase its value and income potential.
Stated income/verified assets: Income is disclosed and the source of the income is verified, but the amount is not verified. Assets are verified, and must meet an adequacy standard such as, for example, 6 months of stated income and 2 months of expected monthly housing expense. Stated income/stated assets: Both income and assets are disclosed but not verified. However, the source of the borrower's income is verified. No ratio: Income is disclosed and verified but not used in qualifying the borrower. The standard rule that the borrower's housing expense cannot exceed some specified percent of income, is ignored. Assets are disclosed and verified. No income: Income is not disclosed, but assets are disclosed and verified, and must meet an adequacy standard. Stated Assets or No asset verification: Assets are disclosed but not verified, income is disclosed, verified and used to qualify the applicant. No asset: Assets are not disclosed, but income is disclosed, verified and used to qualify the applicant. No income/no assets: Neither income nor assets are disclosed.
Bridge loans make sense when a property needs renovation, lease-up, or repositioning before it qualifies for permanent financing.
When the potential value of building new exceeds the cost of acquiring and renovating an existing property.
It is an upfront cash payment required by the lender as part of the charge for the loan, expressed as a percent of the loan amount; e.g., "2 points" means a charge equal to 2% of the loan balance.