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in Atwater, CA
Most Atwater buyers use conventional loans because home prices sit comfortably under conforming limits. Jumbo loans only come into play when you're buying above $806,500 in Merced County.
The loan you need depends entirely on your purchase price. Below the limit, conventional loans offer better rates and easier approval. Above it, jumbo loans are your only option.
Conventional loans follow Fannie Mae and Freddie Mac guidelines. You can put down as little as 3%, though 20% avoids PMI. Rates run lower because these loans get sold to government-sponsored enterprises.
Credit requirements start at 620, but you'll get better pricing at 740+. Debt-to-income caps at 50% in most cases. Most Atwater transactions close with conventional financing because homes rarely hit jumbo territory.
Jumbo loans exceed the $806,500 conforming limit for Merced County. They carry higher rates because lenders hold the risk instead of selling to Fannie or Freddie. Expect to pay 0.25% to 0.75% more than conventional rates.
Lenders want 700+ credit scores and 20% down minimum. Some require reserves equal to 6-12 months of payments. Documentation gets stricter—two years of tax returns, asset verification, and lower debt ratios around 43%.
The rate gap matters more than you'd think. On a $900,000 loan, a 0.5% rate difference costs you $275 extra monthly. That's $99,000 over 30 years. Rates vary by borrower profile and market conditions.
Conventional loans allow gift funds for down payments and flexible employment history. Jumbo lenders scrutinize everything—one bank statement overdraft can delay closing. They want to see stable income and substantial reserves.
If you're buying under $806,500 in Atwater, use a conventional loan. You'll save money on rates and face easier approval. Even if you can afford more, staying under the jumbo threshold means better terms.
Jumbo loans only make sense when the property you want exceeds conforming limits. Prepare for tougher underwriting and higher costs. We shop across 200+ lenders to find competitive jumbo rates, but they'll never beat conventional pricing.
The limit is $806,500 for Merced County in 2024. Anything above that requires a jumbo loan.
No. Jumbo lenders require 20% minimum, and some want 25-30% for the best rates.
Yes, typically 0.25-0.75% higher. Lenders take more risk without Fannie Mae backing.
Yes, but you'll need 15-25% down and pay higher rates than primary residence loans.
Conventional loans close quicker. Jumbo underwriting takes longer due to stricter documentation requirements.