Loading
in Torrance, CA
Torrance sits in the heart of the South Bay with home prices that often push conventional loan limits. Understanding when you need a jumbo loan versus a conventional loan determines your rate, down payment, and approval odds.
The line between these two loan types is set by the FHFA conforming loan limit. In Los Angeles County for 2024, that's $766,550 for single-family homes — anything above requires jumbo financing.
Conventional loans work for Torrance properties up to $766,550. These mortgages follow Fannie Mae and Freddie Mac guidelines, which means standardized underwriting and more lender options.
You can put down as little as 3% with conventional financing, though 20% down eliminates PMI. Credit minimums start at 620, but expect better rates with 740+ scores.
Conventional loans offer the most competitive rates because lenders can sell them to Fannie or Freddie. This secondary market backing keeps pricing tight across our 200+ lender network.
Jumbo loans handle Torrance purchases above $766,550 — common for larger homes in Hollywood Riviera, Old Torrance, or newer builds near Del Amo. These loans don't conform to agency limits, so lenders hold more risk.
Expect stricter requirements: most jumbo lenders want 10-20% down, 700+ credit, and debt-to-income below 43%. Cash reserves matter more here — typically 6-12 months of payments in the bank after closing.
Jumbo rates now often match or beat conventional rates, especially for well-qualified borrowers. Lenders compete hard for jumbo business, and strong credit gets rewarded with aggressive pricing.
Down payment splits these loans most clearly. Conventional allows 3% down; jumbo typically requires 10% minimum. That's $23,000 versus $100,000 on a $1M Torrance home.
Credit standards tighten with jumbo loans. A 680 score might work conventional, but jumbo lenders want 700-720 for best pricing. Reserve requirements also jump — conventional asks for 2 months, jumbo wants 6-12 months.
Rates vary by borrower profile and market conditions. Strong jumbo borrowers often see rates within 0.125-0.25% of conventional. Weaker credit profiles pay a steeper jumbo premium, sometimes 0.5-0.75% higher.
Your purchase price decides this first. Below $766,550, conventional is almost always the better choice — easier qualification, lower down payment, more lenient reserves.
Above that limit, jumbo is your only option unless you increase your down payment to bring the loan amount under the conforming cap. On a $900,000 home, putting $133,450 down keeps you conventional at $766,550 borrowed.
Most Torrance buyers choose jumbo when they want to preserve cash or can't hit the down payment needed to stay conventional. If you have strong credit and solid reserves, jumbo rates won't penalize you much.
Loans above $766,550 are jumbo in Los Angeles County. This is the 2024 conforming limit set by the FHFA for the area.
Yes, some lenders offer 10% down jumbo programs. Expect higher rates and stricter credit requirements than 20% down options.
Not always. Borrowers with 740+ credit and strong reserves often see jumbo rates within 0.25% of conventional pricing.
Most jumbo lenders want 6-12 months of mortgage payments in liquid reserves after closing. Conventional typically requires only 2 months.
Yes. If you can bring the loan amount to $766,550 or below, you qualify for conventional financing with better terms.