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Santa Monica Mortgage FAQ
Santa Monica's coastal real estate market demands financing strategies most traditional lenders don't understand. We see borrowers daily who need jumbo loans, bank statement programs, or portfolio products that match this city's unique price points.
Our team works with 200+ wholesale lenders to find programs that fit self-employed tech workers, entertainment professionals, and investors competing in this market. We answer the questions borrowers actually ask when buying here.
This guide covers everything from down payment requirements to loan types that work for non-traditional income. Every answer reflects what we see approved daily across Santa Monica transactions.
Conventional loans need 620 minimum, but 700+ gets better rates on jumbo loans common here. FHA accepts 580 with higher down payments.
Conventional loans allow 3-5% down, but most Santa Monica properties need jumbo loans requiring 10-20%. Investment properties typically need 25% down.
Any loan above $806,500 is jumbo in 2024. Most single-family homes in Santa Monica exceed this limit and require jumbo financing.
Yes. Bank statement loans use 12-24 months of deposits instead of tax returns. We also offer 1099 loans and profit-loss statement programs.
W-2 borrowers need paystubs, tax returns, and bank statements. Self-employed need business bank statements or 1099s depending on the program.
Pre-approval takes 24-48 hours. Full approval runs 21-30 days for conventional loans, sometimes faster for all-cash equivalent bridge loans.
Get pre-approved. Santa Monica sellers ignore pre-qualification letters because they don't verify income or assets.
Jumbo loans dominate here due to high prices. Portfolio ARMs and interest-only loans help with cash flow on expensive properties.
Yes, but FHA caps at $806,500 in LA County. You'll only find condos or fixers at that price point in Santa Monica.
FHA allows 580 credit and 3.5% down but charges permanent mortgage insurance. Conventional needs 620+ credit and drops PMI at 20% equity.
Yes, with limits. VA caps at $806,500 without a down payment. Above that, veterans need to cover 25% of the difference.
Expect 2-5% of the purchase price. This includes lender fees, title insurance, escrow, and county transfer taxes.
Not on purchase loans. Sellers can credit costs, or you can choose a higher rate for lender credits.
PMI is private mortgage insurance required below 20% down. Avoid it by putting 20% down or using piggyback loans.
Only if you're keeping the loan 5+ years. Most Santa Monica buyers refinance or sell within three years.
Bank statement loans qualify you using deposits, not tax returns. Perfect for business owners who write off most income.
Yes. Foreign national loans require 20-40% down and don't need US credit history or Social Security numbers.
DSCR loans approve based on rental income, not your personal income. No tax returns or employment verification required.
ARMs offer lower initial rates that adjust after a fixed period. 7/1 and 10/1 ARMs are common on Santa Monica jumbo loans.
Portfolio ARMs are held by the lender, not sold to investors. They offer flexible underwriting for complex income or high net worth borrowers.
Yes on jumbo loans. You pay only interest for 5-10 years, then principal and interest. Requires strong credit and reserves.
Asset depletion loans qualify you using investment accounts divided by loan term. Common for retirees with large portfolios.
Most jumbo loans need 6-12 months of mortgage payments in reserves. Investment properties often require 12-24 months.
Conventional loans allow 43-50% DTI. Jumbo loans prefer below 43%, though some portfolio programs stretch higher.
Yes, if the complex is warrantable. Lenders review HOA budgets and ownership concentration before approving condo loans.
Bridge loans fund your purchase before selling your current home. Common in competitive Santa Monica markets with short contingency periods.
Hard money approves in days based on property value, not your credit. Rates run 8-12% for short-term financing or major rehabs.
Yes. ITIN loans work for borrowers without Social Security numbers. Requires 15-25% down and documented income.
HELOCs are revolving credit lines with variable rates. Home equity loans provide lump sums with fixed rates and payments.
30-year loans have lower payments but more interest. 15-year loans build equity faster with rates about 0.5% lower.
Rates vary by borrower profile and market conditions. Jumbo rates typically run 0.25-0.75% above conforming loans depending on down payment and credit.
Single-family homes get the best terms. Condos need warrantability approval. Investment properties require higher down payments and rates.
Yes. You can use FHA or conventional on 2-4 units if you occupy one. Investment loans work for non-owner occupied units.
You need to cover the gap in cash, renegotiate, or cancel. Low appraisals are rare in Santa Monica's stable market.
Lock when you're satisfied with the rate. Floating risks higher rates if markets move before closing.
Construction loans fund builds in draws as work completes. They convert to permanent mortgages once construction finishes.
Only if it's FHA, VA, or USDA. Most Santa Monica loans are conventional and not assumable.
Community mortgages offer down payment assistance or flexible terms for qualified buyers. Availability varies by lender and program funding.
No. California uses escrow companies and title officers instead of closing attorneys.
Compare APR, not just rate. APR includes fees and shows true borrowing cost across different lenders.
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.