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Hermosa Beach Mortgage FAQ
Hermosa Beach isn't a typical Los Angeles market. Most properties here hit jumbo territory fast, and coastal inventory moves differently than inland neighborhoods.
We work with borrowers across the South Bay daily. These FAQs cover what actually matters when financing a home here—from loan types that fit beach properties to down payment realities.
With 200+ lenders, we match each borrower to the right program. That matters more in Hermosa where standard conventional loans often don't cover the purchase price.
Conventional loans start at 3% down, but most Hermosa properties exceed conforming limits and need jumbo loans requiring 10-20% down. Your actual minimum depends on purchase price and loan program.
Most likely yes. Conforming loan limits for Los Angeles County are $806,500 in 2024—many Hermosa Beach homes sell well above that threshold.
Jumbo loans typically require 680-700 minimum credit scores. Conventional conforming loans can go as low as 620, but you'll pay higher rates below 700.
Standard purchases close in 30-45 days. We can expedite to 21 days with complete documentation and motivated sellers in competitive situations.
FHA loan limits are $644,000 in Los Angeles County, which eliminates most Hermosa inventory. They work for condos under that threshold.
Bring two years of tax returns, two months of bank statements, recent pay stubs, and W-2s. Self-employed borrowers need profit and loss statements plus business bank statements.
Yes, and they're common here with many self-employed South Bay business owners. We calculate income from 12-24 months of personal or business bank deposits.
Expect 2-5% of purchase price for lender fees, title insurance, escrow, and appraisal. On a $2 million purchase, that's $40,000-$100,000 depending on your loan.
Fixed rates lock your payment for 30 years. ARMs start lower but adjust after 5-10 years—they make sense if you'll sell within the fixed period.
Not if you put 20% down. Below 20%, some jumbo programs require PMI while others build the cost into your interest rate instead.
Yes. We offer Foreign National loans requiring 20-40% down with no U.S. credit history or Social Security number needed.
Lenders require flood zone verification and may mandate flood insurance if you're in a FEMA zone. Coastal erosion concerns can also impact appraisals on beachfront properties.
DSCR loans qualify you based on rental income, not personal income. They work perfectly for Hermosa investment properties where rent covers the mortgage payment.
Yes, but lenders require 10-20% down and verify you have a primary residence elsewhere. Second home rates run slightly higher than primary residence rates.
Pre-qualification is an estimate based on what you tell us. Pre-approval means we've verified your income, assets, and credit—sellers take you seriously.
With 20% down, expect to need $400,000+ annual income for comfortable approval. Debt-to-income ratios max at 43-50% depending on your loan type.
Yes. Family members can gift funds with a signed letter stating no repayment expectation. Jumbo loans typically limit gifts to part of your down payment.
You pay only interest for 5-10 years before principal payments start. High-income borrowers with variable compensation often use these for cash flow flexibility.
Yes. Lenders review HOA financials, reserve funds, and ownership ratios. Some buildings don't qualify if they're heavily investor-owned or have pending litigation.
Traditional loans need two years of tax returns showing stable income. Bank statement and P&L loans work better if your tax returns show minimal income.
Standard loans won't fund properties needing major repairs. Construction loans or hard money loans cover purchase and renovation, then convert to permanent financing.
Portfolio ARMs are held by the lender, not sold to Fannie Mae. They offer flexible underwriting for complex income situations common with high-net-worth South Bay buyers.
You pay points upfront to reduce your rate—one point costs 1% of loan amount and typically lowers your rate 0.25%. Makes sense if you're keeping the loan 7+ years.
Yes, once you reach 20% equity through appreciation or paydown. Hermosa Beach properties can appreciate quickly, making this viable within a few years.
Lenders qualify you based on investment accounts, dividing your assets by 360 months. Perfect for retirees or trust fund beneficiaries buying in Hermosa without employment income.
Yes, with no down payment up to $806,500 purchase price for eligible veterans. Above that, you'll need to cover the difference between VA loan limit and purchase price.
LA County has higher conforming limits than most California counties. Transfer taxes and processing times vary between beach cities and inland communities significantly.
You'll need to renegotiate price, bring more cash to close, or walk away if you have an appraisal contingency. Low appraisals happen when comps are thin.
Some lenders offer float-down locks for 30-90 days. We typically lock rates once you're in contract since Hermosa homes move fast anyway.
Bridge loans let you buy before selling your current home. Common in hot markets where waiting to close could lose you the property to another buyer.
Lenders include HOA fees in your debt-to-income ratio. High HOA fees in Hermosa Beach buildings can reduce the loan amount you qualify for significantly.
Yes. ITIN loans are available for foreign nationals and non-citizens who earn U.S. income but don't have Social Security numbers.
We access 200+ lenders versus one bank's products. That matters with jumbo loans and complex income where rate and program differences run into thousands monthly.
Jumbo loans typically require 6-12 months of housing payments in reserves. On a $15,000 monthly payment, that's $90,000-$180,000 after closing costs and down payment.
Rates vary by borrower profile and market conditions. Calculate your break-even point—if you'll keep the loan past that timeline, points save money long-term.
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.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
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.