Jumbo loans with 5 down payments are still available throughout California. These new low-down payment jumbo programs allow CA homeowners to take a mortgage loan that exceeds the conventional loan limits set by Fannie Mae or Freddie Mac.
With interest rates still reasonable some homeowners would like to consider a jumbo loan to get more house for their money. In addition, the 5% jumbo loan does not require monthly mortgage insurance like many other loans with a down payment below 20%. Below we take a brief look at the jumbo loan basics and discuss all the things you need to know.
First, a jumbo mortgage is a home loan that exceeds the typical lending limits of Freddie Mac and Fannie Mae, FHA or the Veterans Administration. Loans sold to either Fannie or Freddie are called conventional loans or conforming loans because the mortgage amount “conforms” to the underwriting guidelines and lending limit of these companies.
Loans above the following limits are called jumbo loans. Please find the complete county-by-county list of 2023 California Conforming Loan Limits
Some of the most popular CA cities are listed below. Again, any loan amount above the number listed below is classified as a “Jumbo” This applies to standard (1) unit properties:
San Francisco: $1,089,300
Los Angeles (LA & Orange County) $1,089,300
San Diego: $977,500
San Jose: $1,089,300
Until recently, borrowers had to put 10-20% down if they wanted to purchase a home and borrow over the conventional loan limit. The 95% Jumbo mortgage with no monthly PMI is a great financing option for California borrowers who want to purchase a home or refinance.
This program will allow qualified buyers to purchase a home up to $2,000,000 (depending on county) with only 5% down, and have the option of No monthly PMI. There are not many banks, lenders, or mortgage companies that offer this program today.
This is especially good for borrowers in higher-priced luxury markets like Orange County, LA, Santa Clara County and San Francisco County, etc. After all, the median home listing price in Orange County is currently $1,000,000 according to Realtor.com – this represents a 4% increase year over year. San Francisco county is even higher at $1.3mil.
California Jumbo Loan Notes:
- 95% financing is only available for applicants that can fully document income, assets, etc. Reduced doc mortgages are available, but will require a greater 10%-15% down payment.
- To obtain the max 95% financing, borrowers will need a 700+ credit score. 5% down payment loans above $1.5m loan amounts will require a 740 score.
- The program can be used to purchase a single-family home, townhome or condo.
- Investment property purchases are permitted but will require a slightly higher down payment of 20% down or more.
- Jumbo rate-term, plus cash-out refinance options are available for homeowners that already have a high-cost mortgage.
- Jumbo interest rates can vary based on the term and credit score. Borrowers can choose between secure fixed rate options or adjustable rate terms (ARM)
- Applicants can choose an interest rate buy down or reduced closing costs options.
- Higher loan amounts available. Up to 90% LTV financing to $3,000,000 with 720+ credit score. Up to 85% LTV financing to $3.5mil +. Please contact us if you are financing over $4mil.
- Loans are typically structured as a first and second piggyback mortgage in order to avoid monthly PMI costs.
Have questions? Please call us at Ph: 800-962-0677 or just submit the Quick Contact form on this page. We are available to serve you 7 days a week.
Jumbo Mortgage Source specializes in 95% jumbo loans throughout the U.S including CA: Oakland, Bakersfield, Anaheim, Santa Ana, Riverside, Stockton, Fremont, Irvine, Modesto