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in Mendota, CA
Most Mendota buyers stick with conventional loans because they stay under the conforming limit. Jumbo loans come into play when you're financing above $806,500 in 2025.
The right choice depends on your purchase price and financial profile. Both offer solid terms, but jumbo loans demand stronger qualifications.
Conventional loans follow Fannie Mae and Freddie Mac guidelines. They work for properties under $806,500 with credit scores as low as 620.
Put down 20% and you skip mortgage insurance entirely. Less than 20% means PMI until you hit 20% equity, but rates stay competitive.
These loans close faster because underwriters see them daily. Lenders price them aggressively since Fannie and Freddie buy the loans after closing.
Jumbo loans finance amounts above conforming limits. Lenders hold these loans in portfolio, so they set their own rules and price them higher.
Expect to show 700+ credit and reserves covering 6-12 months of payments. Down payment minimums run 10-20% depending on the lender.
Approval takes longer because underwriters scrutinize every detail. You'll document income sources more thoroughly than with conventional loans.
The conforming limit draws the line between these programs. Under $806,500, conventional wins on rate and ease of approval.
Jumbo loans demand better credit and bigger reserves. Rates run 0.25-0.75% higher because lenders shoulder the risk without Fannie or Freddie backing.
Conventional allows 3% down for first-time buyers. Jumbo lenders want 10-20% minimum, and they'll verify every dollar you claim in assets.
Stay conventional if your loan amount fits under $806,500. You'll get better rates, easier approval, and more lender options.
Go jumbo when you need to borrow above conforming limits. Make sure you have strong credit, substantial reserves, and stable income documentation.
Some buyers split financing with a conventional first and a second lien to avoid jumbo pricing. That works if you want to preserve cash and qualify for both loans.
The conforming limit is $806,500 for single-family homes. Anything above that requires a jumbo loan.
Some lenders allow 10% down on jumbo loans. Expect higher rates and stricter reserve requirements than with 20% down.
Jumbo loans don't use traditional PMI. Lenders price the risk into the rate instead of charging separate insurance.
Conventional loans close quicker because underwriters process them daily. Jumbo loans take longer due to extra documentation requirements.
Yes, if your balance drops below $806,500 through payments or appreciation. Refinancing to conventional usually lowers your rate.