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Conforming Loans in Pasadena
Conforming loans work well for move-up buyers in areas like Madison Heights and Bungalow Heaven where many properties fall under the 2024 loan limit. These loans carry the best rates because Fannie Mae and Freddie Mac guarantee them.
Pasadena sits in a high-cost county, giving you access to the elevated conforming limit of $806,500 instead of the standard $766,550. That extra room matters when competing for single-family homes in established neighborhoods.
This loan type dominates the market for traditional borrowers with W-2 income and clean credit. Lenders price conforming loans aggressively because the secondary market guarantee reduces their risk.
You need a 620 credit score minimum, though most competitive rates start at 680. Lenders want 43% debt-to-income or lower, and you can put down as little as 3% on a primary residence.
The property must appraise and meet Fannie or Freddie standards—no major structural issues or commercial use. Income documentation follows traditional patterns: two years of W-2s, recent pay stubs, and tax returns if you claim deductions.
PMI applies when you put down less than 20%, adding $50-$300 monthly depending on credit and down payment. Unlike FHA, you can cancel PMI once you hit 20% equity through payments or appreciation.
Every major lender offers conforming loans because Fannie and Freddie buy them immediately. The rate spread between best and worst lender can hit 0.375% on the same day for the same borrower profile.
Credit unions sometimes beat banks by 0.125-0.25% on conforming products, but their underwriting takes longer. Portfolio lenders rarely compete on rate here since they save their balance sheet for jumbo and non-QM deals.
Rate locks matter more in Pasadena's competitive market where purchase timelines run tight. We shop lenders who can close in 21 days without rate premiums for speed.
Most Pasadena buyers who think they need jumbo actually qualify conforming if they adjust their price range down $50,000-$75,000. The rate savings at conforming limits often beat the perceived value of a slightly larger home.
We see first-time buyers stretch to 5% down to avoid higher PMI tiers, but 3% down with strong credit often costs less monthly than 5% down with a 660 score. Run the actual numbers before padding your down payment.
Property type drives approval more than buyers expect. Condos in older Pasadena buildings sometimes fail warrantability reviews for Fannie Mae, forcing you into portfolio products at worse rates even when the price qualifies.
FHA loans allow lower credit scores but charge lifetime mortgage insurance even after 20% equity. Conforming loans cost more upfront if your credit sits below 680, but they save money long-term once you cancel PMI.
Jumbo loans kick in above $806,500 and require 10-20% down with stricter reserves. If you're buying at $825,000, the extra $18,500 in down payment costs less than the rate premium on a jumbo over 30 years.
ARMs make sense if you plan to move within seven years, but the initial rate advantage over conforming fixed products has narrowed to 0.25-0.375%. The rate certainty usually wins in Pasadena's stable appreciation market.
Pasadena's condo market presents warrantability challenges in pre-1980 buildings without reserve studies or master insurance policies that satisfy Fannie Mae. You need a broker who knows which complexes appraise clean before you write an offer.
The city's historic districts require additional appraisal documentation for Mills Act properties, adding 3-5 days to your closing timeline. Plan your rate lock accordingly or pay extension fees.
Competition from Cal Tech employees and Huntington Hospital staff means multiple offers on conforming-range properties. Your approval strength matters as much as your offer price when sellers compare seven qualified buyers.
$806,500 for 2024 as a high-cost county. This applies to single-family homes, with lower limits for multi-unit properties.
Only if the building meets Fannie Mae warrantability standards. Many older complexes require portfolio lenders instead.
As little as 3% on a primary residence. Expect PMI under 20% down, typically $75-$250 monthly depending on credit score.
Yes, if you show two years of stable income on tax returns. Business write-offs reduce qualifying income, so review returns with a broker first.
740+ gets you top-tier pricing. You can qualify at 620, but rates jump significantly below 680.
21-25 days typical with clean documentation. Historic properties or complex condos add 5-7 days for additional appraisal review.
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.