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Conforming Loans in Compton
Compton buyers benefit from conforming loans because most properties fall well under the 2024 limit of $766,550. This keeps you in the lower-rate tier that Fannie Mae and Freddie Mac backing provides.
First-time buyers and move-up purchasers use conforming loans more than any other product here. The pricing advantage over jumbo loans matters when you're stretching to qualify.
You need 620 minimum credit for conforming loans, though 680+ gets better pricing. Income verification requires two years of W-2s or tax returns if you're self-employed.
Down payment starts at 3% for first-time buyers, 5% for repeat purchasers. Expect to pay mortgage insurance below 20% down until you hit that equity threshold.
Debt-to-income ratios max out at 50% in most cases. Lenders calculate your total monthly debts against gross income to determine what you can borrow.
Every major wholesale lender offers conforming loans because Fannie Mae buys them. This creates real competition—I often see rate differences of 0.375% between lenders on the same day.
Credit unions and local banks tend to match wholesale pricing but move slower. Direct lenders advertise low rates but lack flexibility when your file has any wrinkles.
Shopping your loan across 200+ wholesale lenders matters here. A $400,000 conforming loan at 6.5% versus 6.875% costs you $90 more per month for 30 years.
Compton buyers often qualify for conforming loans but don't realize it. They assume FHA is their only option because of lower credit scores or smaller down payments.
Conforming beats FHA when you have 680+ credit and 5% down. You'll pay less in mortgage insurance and can cancel it at 20% equity instead of carrying it for the loan term.
Watch your loan amount if buying near the conforming limit. Crossing $766,550 by even $1,000 pushes you into jumbo territory with different rates and requirements.
FHA loans require 3.5% down versus 3% conforming, but the mortgage insurance costs more. FHA charges 1.75% upfront plus 0.55-0.85% annually that never drops off on most loans.
Jumbo loans kick in above $766,550 and typically cost 0.25-0.50% more in rate. They also require 10-20% down and stronger credit profiles than conforming programs allow.
Conventional 97 programs let first-timers put down just 3% through conforming guidelines. This beats FHA for most buyers with decent credit scores.
Los Angeles County property taxes run about 1.1% of purchase price annually. This affects your debt-to-income calculation and how much home you can afford under conforming guidelines.
Appraisals in Compton sometimes come in below contract price in transitional neighborhoods. Conforming loans require the lower of purchase price or appraised value, so this caps your loan amount.
HOA fees in newer Compton developments add to your monthly payment for qualification purposes. Lenders count these in your debt ratio even though they're not actual debt obligations.
$766,550 for single-family homes. This is the standard limit for most California counties outside high-cost areas like San Francisco or Orange County.
Yes, if you're a first-time buyer or meet HomeReady/Home Possible income limits. Repeat buyers typically need 5% down for conforming financing.
680+ gets you standard pricing. Below 680, expect rate adjustments of 0.25-1.0% depending on down payment and other risk factors.
Your conforming loan amount drops to match the appraised value. You'll need a bigger down payment or negotiate a lower purchase price with the seller.
Yes, below 20% down payment. Unlike FHA, you can cancel it once you reach 20% equity through payments or appreciation.
Absolutely. You'll provide two years of tax returns instead of W-2s. Lenders average your income and subtract business write-offs to calculate qualifying income.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Mortgage programs that allow borrowers to qualify based on liquid assets rather than traditional employment income.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Asset-based short-term loans primarily used by real estate investors for property acquisition and renovation projects.
Mortgages that allow borrowers to pay only the interest for an initial period, resulting in lower monthly payments upfront.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Non-QM mortgages that use a CPA-prepared profit and loss statement to verify income for self-employed borrowers.
Home loans with interest rates that adjust periodically based on market conditions after an initial fixed-rate period.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
Government-insured mortgages from the Federal Housing Administration with low down payments and flexible credit requirements.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.