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Sweet Loans for Every Taste: Which Mortgage Treat Is Right for You?

May 29, 2025 by Kay Monigold

Let’s face it, picking the right mortgage can feel overwhelming. But what if we made it more fun? Think of home loans like candy bars: each one has a distinct flavor, a specific audience, and its own perfect time and place. Whether you’re buying your first home, building your dream house, or tapping into retirement equity, there’s a mortgage match made just for you.

So let’s have a little fun with this sweet comparison…

FHA Loan – Milky Way
Smooth, classic, and made for first-timers.
FHA loans are the Milky Way of the mortgage world, soft, reliable, and oh-so-comforting. Designed for buyers with lower credit scores or smaller down payments, they’re ideal for those just starting their homeownership journey. With as little as 3.5% down and more lenient qualification standards, FHA loans are the classic comfort treat that helps many get a taste of homeownership.

VA Loan – PayDay
Salty, sweet, and packed with benefits for our heroes.
Just like a PayDay bar, VA loans combine rich rewards with a solid core. Exclusively available to eligible veterans, active-duty service members, and some surviving spouses, these loans offer zero down payment, no private mortgage insurance (PMI), and competitive interest rates. It’s a well-deserved treat for those who’ve served.

USDA Loan – 3 Musketeers
Light, fluffy, and built for the rural dream.
USDA loans are like the airy 3 Musketeers bar, light on the budget, heavy on the benefits. Designed for eligible rural and suburban areas, these loans offer no down payment and low interest rates, making them ideal for buyers dreaming of more space and a slower pace.

Conventional Loan – Snickers
Tried and true. Satisfies almost every situation.
You can’t go wrong with a Snickers, and the same goes for conventional loans. Whether you’re a seasoned buyer or refinancing, conventional loans are flexible, widely accepted, and perfect for those with strong credit and stable income. They’re the all-around winner that works for most situations.

Non-QM Loan – Twix
A little unexpected, flexible, and full of surprises.
Non-QM (Non-Qualified Mortgage) loans are for the out-of-the-box borrowers. Like a Twix, they offer a bit of a twist, great for self-employed individuals, investors, or anyone with unique financial documentation. They aren’t bound by traditional rules but still satisfy your financing needs with flair.

1099 Loan – Butterfinger
Crunchy and built for self-employed hustlers.
Independent contractors and gig workers, this one’s for you. Just like a Butterfinger, a 1099 loan has that extra crunch and texture—meant for those who don’t fit into W-2 boxes. If you’ve got income from contracts, freelancing, or side hustles, this loan keeps things sweet and flexible.

Bank Statement Loan – Hershey’s Cookies ‘n’ Creme
Smooth but with all the necessary chunks (of proof!).
Forget pay stubs, bank statement loans are here for the entrepreneurs and business owners who prove income through deposits. Like a Hershey’s Cookies ‘n’ Creme bar, it’s a smooth solution with bits of evidence baked in. This one’s all about showing your worth in your own unique way.

Reverse Mortgage – Werther’s Original
Classic, comforting, and perfect for the golden years.
Just like those timeless golden candies, reverse mortgages are made for homeowners 62 and older who want to tap into their home’s equity without leaving the house they love. It’s about adding sweetness and security to retirement with no monthly mortgage payments.

Construction Loan – Kit Kat
Break it down, build it up, layer by layer.
If you’re building a home from the ground up or taking on a major renovation, the construction loan is your Kit Kat. It’s structured, strategic, and all about financing your home in phases. With each stage of building funded in steps, this loan breaks down big dreams into manageable bites.

Find Your Flavor, Find Your Fit
Just like your favorite candy bar, the best loan for you is the one that suits your unique tastes, lifestyle, and goals. Whether you need something soft and simple or layered and bold, there’s a mortgage treat waiting to be unwrapped.

Let’s talk sweets… I mean, solutions! 🙂

Message us anytime, and let’s find the right loan to satisfy your homebuying cravings.

Filed Under: Mortgage Tagged With: Loan Flavors, Mortgage Humor, Mortgage Made Fun

The Impact of Rental Income on Mortgage Qualification

May 8, 2025 by Kay Monigold

For real estate investors and homeowners looking to purchase additional properties, rental income can play a crucial role in mortgage qualification. Lenders often consider this income when assessing a borrower’s ability to repay a loan, but the way it is calculated and applied varies based on different loan programs and underwriting guidelines. Understanding how rental income factors into mortgage approval can help buyers maximize their borrowing potential and secure favorable financing terms.

How Lenders Assess Rental Income
Lenders typically evaluate rental income based on documentation such as lease agreements, tax returns, and property appraisals. The amount of income they recognize depends on the property’s occupancy status:

  • Existing rental properties: If a borrower owns rental properties, lenders usually require two years of tax returns (Schedule E from IRS Form 1040) to determine average rental income. Depreciation and other expenses are typically added back to calculate the borrower’s effective income.
  • New rental properties: If a borrower is purchasing an investment property or converting a current home into a rental, lenders may allow a portion of the projected rental income to offset the mortgage payment. This is often determined through a rent schedule (Fannie Mae Form 1007 or Freddie Mac Form 1000).

Rental Income and Debt-to-Income (DTI) Ratio
Debt-to-income ratio (DTI) is a key metric lenders use to assess affordability. Rental income helps lower a borrower’s DTI by either increasing total income or offsetting the mortgage payment. However, lenders typically apply a vacancy factor—usually 25%—to account for potential rental gaps, meaning they may only consider 75% of the rental income.

For example, if a property generates $2,000 in monthly rent, the lender may only count $1,500 toward the borrower’s income. This adjustment ensures that a borrower can manage expenses even during vacancies.

Loan Program Considerations
Different loan programs have varying requirements for rental income qualification:

  • Conventional Loans: Fannie Mae and Freddie Mac allow rental income from leased properties and projected rental income with proper documentation.
  • FHA Loans: The Federal Housing Administration permits rental income to qualify if the borrower has at least a two-year history of managing rental properties.
  • VA Loans: The Department of Veterans Affairs allows rental income on multi-unit homes if the borrower occupies one of the units.
  • DSCR Loans: Debt Service Coverage Ratio (DSCR) loans focus primarily on a property’s income rather than the borrower’s personal finances, making them a great option for investors.

Maximizing Rental Income for Mortgage Qualification
To improve mortgage eligibility using rental income, borrowers should:

  • Keep detailed financial records, including lease agreements and tax returns.
  • Ensure rental properties are well-maintained and occupied.
  • Work with lenders who understand investment property financing.
  • Consider loan programs that best fit their investment goals.

Rental income can be a powerful tool in mortgage qualification, but lenders apply specific guidelines to ensure financial stability. Understanding how it factors into loan approval can help borrowers make informed decisions and optimize their financing options.

Filed Under: Mortgage Tagged With: Mortgage Applications, Mortgage Qualification, Rental Income

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Our Team

Kay MonigoldKay Monigold
Owner/Mortgage Broker/Residential Mortgage Loan Originator
NMLS#1086176

Ron MartinRon Martin
Residential Mortgage Loan Originator

NMLS#316821

Steven LoweSteven P Lowe, Sr
Residential Mortgage Loan Originator
NMLS #1085638

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