Loading
in Arcadia, CA
Arcadia's housing market sits in a gray zone where some properties fit conventional loan limits and others blow past them. The 2024 conforming limit for Los Angeles County is $766,550 for a single-family home.
Most Arcadia homes push or exceed that threshold. That means buyers here need to understand both options cold before they start shopping.
Conventional loans follow guidelines set by Fannie Mae and Freddie Mac. You can put down as little as 3% with strong credit, though most lenders want 5-10% for competitive rates.
These loans cap at $766,550 in LA County for single-family homes. Credit score minimums typically start at 620, but you'll need 700+ for the best pricing. PMI applies if you put down less than 20%.
Rates on conventional loans run lower than jumbo because the loans get sold to Fannie and Freddie. That backing reduces lender risk and passes savings to borrowers.
Jumbo loans kick in the moment you exceed $766,550 in LA County. These mortgages don't get sold to Fannie or Freddie, so lenders hold more risk and tighten their standards accordingly.
Expect to put down 10-20% minimum, with some lenders requiring more for loan amounts above $2 million. Credit scores need to be 700 or higher, and many lenders want 720+ for their best jumbo rates.
Debt-to-income ratios matter more on jumbos. Most lenders cap you at 43% DTI, though some go to 45% with strong reserves. You'll need 6-12 months of mortgage payments sitting in liquid assets after closing.
Down payment requirements diverge sharply. Conventional loans let you buy with 3-5% down if your credit is strong. Jumbo lenders want 10-20% minimum, and that percentage climbs as the loan amount increases.
Rate differences shift with market conditions. Right now, jumbo rates often match or even undercut conventional rates because portfolio lenders compete hard for high-balance business. That wasn't true two years ago and won't always be true going forward.
Underwriting scrutiny gets tighter on jumbos. Lenders verify everything twice and want detailed explanations for any large deposits. Asset reserves become mandatory rather than optional.
If you're buying under $766,550 in Arcadia, stick with conventional. You'll have more lender options, easier qualification, and lower down payment requirements. No reason to complicate things.
Above that threshold, jumbo becomes your only choice. Focus on getting your credit above 720 and building cash reserves to six months of payments minimum. The stricter requirements aren't negotiable.
Some buyers split the difference by putting more down to stay under the conforming limit. That works if you have the cash and want to avoid jumbo underwriting, but it ties up capital you might prefer to keep liquid.
Yes, if you can reduce the loan amount below $766,550. But you're locking up capital that might earn better returns elsewhere or provide financial flexibility.
Not always. Right now many jumbo rates match or beat conventional rates because portfolio lenders compete aggressively. This changes with market conditions though.
Minimum is 700 with most lenders, but 720+ gets you the best rates. Anything below 700 means you're shopping a very limited pool of jumbo lenders.
No. Jumbo loans don't have PMI regardless of down payment size. You'll still need 10-20% down, but no monthly mortgage insurance premium.
Most lenders want 6-12 months of mortgage payments in liquid assets after closing. Higher loan amounts push that requirement toward 12 months or more.