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Most San Luis Obispo buyers use conforming loans because they meet Fannie Mae and Freddie Mac limits. These loans offer the lowest rates and most flexible terms when you qualify.
Fed officials signal several rate cuts coming later in 2026, which should continue pushing conforming loan rates lower. Your timing matters—lock when rates dip, not when they spike.
Conforming Loans in San Luis Obispo
You need 620 credit minimum, but 740+ gets you the best pricing. Debt-to-income can stretch to 50% with strong compensating factors like reserves or stable employment.
Down payment starts at 3% for first-time buyers, 5% for repeat buyers. Anything under 20% requires PMI until you hit 20% equity through payments or appreciation.
Local decision guide
Use this guide to connect conforming loans eligibility, lender expectations, and local market factors before comparing payment options in San Luis Obispo.
Most San Luis Obispo buyers use conforming loans because they meet Fannie Mae and Freddie Mac limits. These loans offer the lowest rates and most flexible terms when you qualify.
Fed officials signal several rate cuts coming later in 2026, which should continue pushing conforming loan rates lower. Your timing matters—lock when rates dip, not when they spike.
You need 620 credit minimum, but 740+ gets you the best pricing. Debt-to-income can stretch to 50% with strong compensating factors like reserves or stable employment.
We shop 200+ wholesale lenders to find who's pricing conforming loans aggressively this week. Rate sheets change daily, so yesterday's best lender might not be today's.
Big banks advertise heavily but rarely win on price. Credit unions compete on conforming loans, but our wholesale access beats most retail channels by 0.125% to 0.375%.
San Luis Obispo sits in a conforming loan sweet spot. Most single-family homes fall under the $832,750 limit, so you avoid jumbo pricing on properties that would trigger it elsewhere.
If you're close to the limit, consider making a larger down payment to stay conforming. The rate savings over 30 years outweigh the upfront cash difference in most cases.
FHA loans require 3.5% down but carry mortgage insurance for life on 30-year loans. Conforming drops PMI at 20% equity, saving you $150-$300 monthly once you hit that threshold.
Jumbo loans kick in above conforming limits with stricter credit requirements and higher rates. If your loan amount is borderline, structure it to stay conforming.
San Luis Obispo's university-driven economy creates steady buyer demand but also seasonal inventory swings. Conforming loans close faster than jumbo, giving you an edge in spring competition.
Condos near Cal Poly face warrantability reviews by lenders. Some complexes get blacklisted due to high investor concentration or deferred maintenance, limiting your conforming loan options.
$832,750 for single-family homes. Above that, you need a jumbo loan with stricter requirements and higher rates.
Only if it's habitable at closing. Major repairs require a renovation loan like Fannie Mae HomeStyle, which has different guidelines.
We see 0.25% to 0.5% spread on identical scenarios. That's $50-$100 monthly on a $500,000 loan—$18,000 to $36,000 over 30 years.
PMI is factored into your debt-to-income ratio. Lenders approve you with it included, so it doesn't block deals—just increases monthly payment.
Yes, with two years of tax returns showing stable income. Lenders average your net profit after deductions, so write-offs reduce buying power.