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in South Pasadena, CA
South Pasadena's housing market straddles the line where conventional loans max out and jumbo territory begins. Many properties here require jumbo financing simply because conforming limits can't cover the purchase price.
The difference isn't just loan size. Jumbo loans come with stricter qualification standards and different rate structures. Understanding which loan you need determines how you approach the entire buying process.
Conventional loans max out at $832,750 for single-family homes in Los Angeles County. They follow Fannie Mae and Freddie Mac guidelines, which means predictable underwriting and competitive rates.
You can put down as little as 3% with a conventional loan. PMI is required below 20% down, but it drops off once you hit that equity threshold. Credit score minimums typically start at 620, though better rates require 740-plus.
These loans work well for South Pasadena condos and smaller single-family homes. Rate pricing is transparent because lenders can sell these loans to Fannie or Freddie. That secondary market competition keeps costs lower than jumbo options.
Jumbo loans start where conventional loans stop. Anything above $832,750 requires jumbo financing, which means lenders hold more risk since these loans don't get sold to Fannie or Freddie.
Expect stricter requirements across the board. Most jumbo lenders want 10-20% down, though some accept less with strong profiles. Credit scores should be 700 minimum, but 740-plus opens better pricing.
Reserve requirements separate jumbo from conventional. Lenders typically want 6-12 months of mortgage payments in the bank after closing. Debt-to-income ratios max out around 43% for most programs, tighter than conventional caps.
Local decision guide
Use this comparison to weigh Conventional Loans and Jumbo Loans through local payment fit, eligibility, documentation, and timing before choosing a path in South Pasadena.
South Pasadena's housing market straddles the line where conventional loans max out and jumbo territory begins. Many properties here require jumbo financing simply because conforming limits can't cover the purchase price.
The difference isn't just loan size. Jumbo loans come with stricter qualification standards and different rate structures. Understanding which loan you need determines how you approach the entire buying process.
Conventional loans max out at $832,750 for single-family homes in Los Angeles County. They follow Fannie Mae and Freddie Mac guidelines, which means predictable underwriting and competitive rates.
The biggest split is qualification standards. Conventional loans offer more flexibility on income ratios and reserves. Jumbo lenders compensate for higher risk with tighter underwriting across every metric.
Rates vary by borrower profile and market conditions. Jumbo rates sometimes beat conventional pricing for borrowers with excellent credit and large down payments. Weaker profiles pay significantly more on jumbo loans than they would on conventional financing.
Documentation depth differs noticeably. Jumbo underwriters scrutinize every deposit, employment gap, and asset source. Conventional loans follow standardized checklists. Jumbo files get manual reviews that conventional loans skip.
Your purchase price makes the decision for you in most cases. Properties under $832,750 should use conventional financing unless you have unique income documentation needs. Above that threshold, jumbo is your only conforming option.
Borderline situations require math. If you're looking at $750,000 homes, conventional works cleanly. At $800,000, you need jumbo, which means proving stronger reserves and potentially accepting different rate pricing.
South Pasadena buyers often find themselves shopping across both categories. Start pre-approval conversations early so you understand which properties fit your qualification profile. Jumbo approval takes weeks longer than conventional processing.
$832,750 for single-family homes in Los Angeles County. Anything above requires jumbo financing.
Not always. Strong credit and large down payments can secure jumbo rates competitive with conventional pricing. Rates vary by borrower profile and market conditions.
Yes, if the purchase price stays under $832,750. You'll pay PMI until reaching 20% equity.
Most lenders require 6-12 months of mortgage payments saved after closing. Higher loan amounts may need larger reserves.
Yes. Conventional minimums start at 620, while jumbo lenders typically want 700-plus for approval and 740-plus for competitive rates.