Frequently Asked Questions

How Much House Can You Afford?
A good rule of thumb is that you can qualify for a house that is about two and a half times your yearly income (before taxes) --- depending, of course, on other factors like your debt ratio or credit history.

What Types of Loans Are There?
Loans can have a fixed interest rate for the life of the loan or a variable interest rate (or Adjustable Interest Rate - ARM) which may start off with a lower interest rate and then go up or down over the life of the loan as the economy changes.

How Much of a Down Payment Will You Need to Buy a House?
This depends on a number of factors including:

  • how much the house you buy will cost,

  • how good your Credit Rating is. 

What is a Lock-In?
"Locking in" your rate or points at the time of application or during the processing of your loan will keep the rate and/or points from changing until settlement or closing.

What is an Escrow Account?
Your monthly mortgage payment will be used to repay the money you borrowed plus interest. Part of your monthly payment may be deposited into an escrow account (also known as a reserve or impound account) so your lender or servicer can pay your real estate taxes, property insurance, and mortgage insurance.

What if You Have Had Credit Problems?
The Loan Officers at All-American Mortgage offer a free credit analysis with each pre-qualification. There are loan programs to match most credit and financial situations.

Why Would You Need Mortgage Insurance?
Private mortgage insurance and government mortgage insurance is to protect the lender against default. It may enable the lender to make a loan which the lender considers high risk. Lenders often require mortgage insurance for loans where the down payment is less than 20% of the sales price.

Ca. Dept. of Real Estate, Real Estate Broker: # 01807067