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in Novato, CA
Novato's housing market straddles a critical line. Many properties fall under the conforming loan limit, but Marin County's premium real estate often pushes you into jumbo territory.
The difference matters more than most borrowers realize. You're not just choosing loan sizes — you're choosing entirely different underwriting standards, rate structures, and qualification hurdles.
Conventional loans stay within FHFA conforming limits — currently $806,500 for single-family homes in most of California. These loans follow standardized guidelines set by Fannie Mae and Freddie Mac.
You can put down as little as 3% for a primary residence. Most lenders require 620 minimum credit, though 680+ gets better pricing. PMI drops off automatically once you hit 78% loan-to-value.
These loans dominate the market because they're liquid. Lenders sell them to Fannie and Freddie, which means more competition and tighter pricing for borrowers.
Jumbo loans finance anything above conforming limits. In Novato, that means properties over $806,500 — which covers a substantial portion of Marin County's housing stock.
Expect stricter requirements across the board. Most lenders want 700+ credit and 10-20% down minimum. You'll need significant reserves, typically 6-12 months of mortgage payments in the bank after closing.
Rates aren't always higher anymore. Jumbo pricing has become competitive in recent years, sometimes matching or beating conforming rates depending on your profile and the lender.
Credit standards separate qualified borrowers from marginal ones fast. Conventional loans work with 620 scores; jumbo lenders rarely look twice under 680, and most prefer 700+.
Down payment requirements tell the real story. Conventional allows 3% down with PMI. Jumbo typically starts at 10%, with 20% getting you the best rates and terms.
Documentation depth varies dramatically. Jumbo underwriters scrutinize everything — multiple bank accounts, asset sources, employment stability. Conventional follows standard checklists without the extra layers.
Debt ratios matter more with jumbos. You might squeeze a 50% DTI through conventional underwriting. Jumbo lenders cap most borrowers at 43%, sometimes 45% with strong compensating factors.
Your home price decides this before anything else. Under $806,500 means conventional wins on flexibility and qualification ease. Over that threshold, jumbo becomes your only choice.
If you're borderline, consider your full financial profile. Strong credit and 20% down makes jumbo straightforward. Thinner reserves or credit in the 600s means stick with conventional and adjust your home search.
Many Novato buyers target homes just under the conforming limit to avoid jumbo requirements. That strategy works if inventory exists in your price range and meets your needs.
Rates vary by borrower profile and market conditions, but well-qualified jumbo borrowers often match conventional pricing. Run numbers both ways before assuming conventional costs less.
$806,500 for single-family homes. Anything above requires jumbo financing regardless of down payment size.
Yes, but expect higher rates and stricter requirements. 20% down unlocks better pricing and easier approval.
Not anymore. Well-qualified borrowers often see competitive jumbo rates, sometimes matching or beating conventional pricing.
Conventional allows 620 minimum. Jumbo lenders typically require 700+, though some accept 680 with compensating factors.
Most want 6-12 months of mortgage payments liquid after closing. Higher loan amounts push toward the upper end.
No. Loan amount determines the category, not purchase price. Buying an $850k home means jumbo financing regardless of down payment.