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Jumbo Loans in Southern California
Jumbo loans are real estate financing loans which exceed the conventional loan limits in California set by Fannie Mae and Freddie Mac. In some areas in Southern California, such as Riverside County or San Bernardino County, a Jumbo loan may be required for a loan of more than $484,350. In other areas of Southern California, such as Orange County and Los Angeles County, a Jumbo loan will be required for a loan more than $726,525 per the 2019 conforming loan limits set by the Federal Housing Finance Agency.
Jumbo loans in Southern California typically have higher interest rates than a conventional or conforming loan. In addition, Jumbo loans will almost unanimously require a larger down payment, and require in many cases, significant proof of reserves. Summit Lending’s Orange County based team of top reviewed mortgage brokers have decades of experience in helping homeowners and home buyers throughout the state of California to obtain Jumbo loans at the best rates available for their dream home.
What is a Jumbo Loan in California?
Jumbo loans are mortgage loans which exceed the conventional (AKA conforming) loan limits in California set by Fannie Mae and Freddie Mac. They do not conform to the lending guidelines set by the Government Sponsored Entities of Fannie Mae and Freddie Mac because the amount of the loan surpasses the limits.
Current conventional/conforming loan limits in Southern California are set by geographic region. They are:
|Los Angeles County:||$726,525|
|San Bernardino County:||$484,350|
|San Diego County:||$690,000|
If you need a loan for more than the allotted limits above, you’ll need a jumbo loan. However, keep in mind that if you want to purchase a home in Orange County that is $876,525, and you have $150,000 for a down payment, you may not necessarily need a jumbo loan. That’s because a jumbo loan only refers to the total amount to be financed. The conforming loan limit is the limit before your down payment.
What are Requirements for Jumbo Loans in California?
Lenders tend to have varying requirements, but generally speaking, jumbo loans will require 10-20% as a down payment, credit scores of at least 680, and a debt to ratio limit of 50% or less. Jumbo loans are typically available up to $2 Million, but some lenders may approve up to $3 Million. In addition, mortgage insurance will be required on loan to value (LTV) above 85%. Note, there are exceptions, and these requirements are not set in stone. Talking to an experienced, established, top-reviewed California mortgage broker will give you more insight into the requirements for your specific needs, based on your specific financial situation.
What is a Jumbo Loan Interest Rate?
Jumbo loans may be either fixed rate or adjustable rate mortgages. The interest rates available on a jumbo loan in California will depend upon your credit, your down payment, the amount you’re borrowing, and the current interest rates at the time that you lock in your jumbo loan. It’s important to remember that just because your loan amount exceeds the conforming loan limits in California, that does not mean that jumbo loans automatically have higher interest rates. In fact, sometimes, jumbo loans may have lower interest rates than conforming loans.
Contact our experienced team of mortgage brokers and mortgage professionals at Summit Lending in Huntington Beach to learn more about jumbo mortgage loans in California. We can be reached online or by calling 888-451-9006.