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Frequently Asked Questions

 

What States Does DHA Financial Operate In?

DHA Financial, LLC is proud to serve homeowners across multiple states. We are fully licensed to offer mortgage services, including home loans and refinance options, in the following states:

  • Colorado

  • Texas

  • Florida

  • Hawaii

  • Washington

  • Idaho

Whether you’re looking to purchase a home, refinance your mortgage, or explore other home loan options, DHA Financial is here to provide you with reliable and professional service in these states.

Why Choose DHA Financial?

At DHA Financial, LLC, we’re dedicated to providing a seamless, fast, and transparent digital mortgage experience. Our team is here to support you every step of the way, ensuring you receive the best possible service without the typical sales pressure.

When you work with us, you can expect:

  • Industry-leading mortgage rates provided in just minutes

  • Fast initial approval—receive your approval in minutes

  • A 100% online mortgage application process for your convenience

  • A team focused on customer support—not sales

With DHA Financial, your home loan journey is quick, easy, and stress-free, backed by a team committed to your success.

Will DHA Financial Service My Loan?

No, DHA Financial, LLC does not service loans. Once your loan is funded, we will transfer the ownership of your loan to a reputable investor who will handle the servicing. During the application process, we will carefully match you with a trusted investor who provides the right type of loan and servicing for your specific needs.

Your dedicated loan officer will inform you about the investor we are working with and will be happy to answer any questions you may have about the servicing process.

What to Expect as a DHA Financial Customer:

  • Industry-leading mortgage rates, quoted in minutes

  • Fast initial approval, often within minutes

  • A 100% online application process for your convenience

  • A team focused on providing support—not sales

At DHA Financial, we prioritize your satisfaction by streamlining the process and connecting you with top investors for your loan servicing needs.

What If I Can't Afford to Put 20% Down?

Not a problem. At DHA Financial, LLC, we understand that coming up with a 20% down payment may not always be feasible. Fortunately, there are many mortgage programs available that require as little as 5% down, making homeownership more accessible than ever.

The best approach is to contact us, and our team will work with you to find the right mortgage program that suits your financial situation. We offer a variety of loan options to ensure you get the most affordable path to homeownership.

Do You Offer Custom Loan programs?

Yes, at DHA Financial, LLC, we offer a wide range of customized loan programs tailored to meet the unique needs of each of our clients. Since the availability of loan programs is constantly evolving, we stay up-to-date with the latest options to find the best loan scenario for you.

Unlike large banks that are often limited to their own loan programs and rates, we have access to a broad network of trusted lenders. This allows us to match you with the lender who offers the best fit for your specific financial situation.

Call us today, and let us help you explore the best mortgage loan programs available to you.

Can I Use My IRA or 401(k) Plan For a Down Payment?

Yes, in many cases, you can use funds from your 401(k) for a down payment on a home. This can be an excellent option if you’re looking to purchase your first home or are in need of additional funds. There are a few ways this can work, such as taking a loan from your 401(k) or using it for a hardship withdrawal, depending on your specific plan rules.

However, it’s important to understand the potential tax implications and penalties that may apply, especially if you choose to withdraw funds. We recommend consulting with a financial advisor to ensure this is the best option for you.

At DHA Financial, LLC, we can guide you through the home loan process and help you understand how you can use your 401(k) as part of your down payment, along with other potential options to make homeownership more affordable.

What's the Difference Between a Fixed Rate and Adjustable Rate Mortgage?

A Fixed Rate Mortgage offers stability, with a consistent interest rate and monthly payments throughout the entire loan term, which can typically range from 15, 20, or 30 years. This predictable structure can provide peace of mind, knowing that your mortgage payments will remain the same throughout the life of the loan. Some variations of fixed-rate mortgages, such as 5-year or 7-year fixed loans, may include balloon payments at the end of the term.

On the other hand, an Adjustable Rate Mortgage (ARM) has an interest rate that fluctuates over time based on changes in a specific financial index. ARMs often start with a lower, discounted interest rate (often called a “teaser” rate), which can make them an attractive option for some buyers. However, once the initial discount period ends, the interest rate can adjust—increasing or decreasing—as market interest rates change.

To prevent drastic changes, ARMs typically include caps, which limit how much the interest rate and/or payments can increase each year or over the entire loan term. There are various ARM options, including hybrid loans that start with a fixed rate for a set number of years (such as 5/1, 7/1, or 10/1 ARMs) and then adjust to a variable rate after the initial period.

Key Differences:

  • Fixed Rate Mortgages provide consistent monthly payments with no surprises.

  • Adjustable Rate Mortgages offer a lower initial interest rate but have the potential for rate fluctuations over time.

Which is Better: Fixed Rate or Adjustable Rate Mortgage?

The choice between a Fixed Rate Mortgage and an Adjustable Rate Mortgage (ARM) depends on several factors, including current interest rates, your financial outlook, and your tolerance for risk.

Fixed Rate Mortgages offer stability with consistent monthly payments and a set interest rate for the entire loan term. This predictability is ideal if you want peace of mind knowing that your payments won’t change, regardless of market conditions. For most buyers, especially in a low interest rate environment, a fixed rate mortgage is often the best option. With interest rates currently low, locking in a fixed rate could protect you from potential future rate increases.

Adjustable Rate Mortgages (ARMs), on the other hand, start with a lower “teaser” interest rate, which can make them attractive in the short term. However, after the initial period, the rate adjusts based on the market, potentially leading to higher payments. While ARMs can be a good option for those who anticipate rates will remain stable or decrease in the short term, they do come with a certain level of risk. In a high inflation environment, ARMs tend to rise, while in lower inflation periods, they may decrease.

Ultimately, when deciding between the two:

  • If interest rates are low and you prefer stability, a fixed rate mortgage is typically the safer option.

  • If you are comfortable with potential fluctuations and expect interest rates to stay low or even decrease in the future, an ARM may be an option to consider.

It’s also worth noting that if interest rates drop significantly after your mortgage is funded, refinancing into a new loan with a better rate might make sense—whether it’s a fixed or adjustable option.

Key Considerations for Choosing:

  • Fixed Rate Mortgage: Ideal if you prefer stable monthly payments and are risk-averse.

  • Adjustable Rate Mortgage (ARM): A viable option if you’re okay with potential rate increases and want lower initial payments.

What is Private Mortgage Insurance (PMI)?

Private Mortgage Insurance (PMI) is a type of insurance that protects the lender in case the borrower defaults on the loan. Typically required when a borrower’s down payment is less than 20%, PMI ensures that the lender is reimbursed for a portion of the loan in case of default.

PMI Premiums are generally paid on a monthly basis, though they can sometimes be financed as part of your loan. The cost of PMI depends on factors such as the size of your down payment and loan, but it’s often a small percentage of the loan amount.

Once you’ve built up enough equity in your home, you may be able to remove PMI. Typically, this happens once your home equity reaches 22% and you’ve kept up with your mortgage payments. The servicing lender will provide specific guidelines on when and how you can cancel your PMI.

Key Takeaways:

  • PMI protects the lender in case of borrower default.

  • It is typically required if you make a down payment of less than 20%.

  • Monthly premiums can be part of your mortgage payments.

  • PMI can be canceled once you have 22% equity in the home and meet certain conditions.