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Hillsborough's luxury real estate market demands financing that matches its scale. Most homes here push past conforming loan limits, so conventional financing often crosses into jumbo territory.
As of February 2026, mortgage rates sit near four-year lows around 6%. The Fed has signaled more cuts later this year, though nothing immediate. Timing matters less than approval strength in this market.
Conventional loans work well here because Hillsborough buyers typically have strong credit and substantial reserves. These loans offer the flexibility high-net-worth borrowers need without government red tape.
Conventional Loans in Hillsborough
You need 620 minimum credit for conventional approval, but Hillsborough transactions typically require 700+. Lenders price more aggressively above 740, which matters on million-dollar-plus loans.
Down payment starts at 3% for primary residences, but expect 20% minimum in this market. Most buyers put down 25-30% to avoid PMI and improve their rate. Reserves matter more here than in lower-priced cities.
Debt-to-income caps at 50% on paper, but jumbo lenders tighten to 43% above conforming limits. Two years of stable income documentation required, W-2 or tax returns for self-employed borrowers.
Local decision guide
Use this guide to connect conventional loans eligibility, lender expectations, and local market factors before comparing payment options in Hillsborough.
Hillsborough's luxury real estate market demands financing that matches its scale. Most homes here push past conforming loan limits, so conventional financing often crosses into jumbo territory.
As of February 2026, mortgage rates sit near four-year lows around 6%. The Fed has signaled more cuts later this year, though nothing immediate. Timing matters less than approval strength in this market.
Conventional loans work well here because Hillsborough buyers typically have strong credit and substantial reserves. These loans offer the flexibility high-net-worth borrowers need without government red tape.
SRK CAPITAL shops 200+ wholesale lenders to find jumbo-comfortable pricing. Not every lender underwrites high-balance loans the same way, and rate spreads can hit 0.5% between best and worst options.
Portfolio lenders often beat agency pricing on jumbo conventionals in Hillsborough. They hold loans on their books rather than selling to Fannie or Freddie, which gives them flexibility on underwriting.
We see better execution through wholesale channels than direct lenders on properties above $2 million. Relationship pricing and investor appetite shift weekly, so broker access to multiple sources matters.
Hillsborough deals close fastest when borrowers provide complete financials upfront. Bank statements, tax returns, and asset documentation before you write an offer. Sellers here expect fast execution.
Appraisals take longer in this market because comparable sales are sparse. Budget 3-4 weeks for valuation, and know that appraisers may pull comps from neighboring Burlingame or Atherton if recent sales are thin.
Most buyers here benefit from ARM products over 30-year fixed. A 7/1 ARM cuts 0.375-0.5% off the rate, which saves $500+ monthly on a $3 million loan. Few people hold these properties seven years anyway.
FHA loans don't work in Hillsborough because loan limits cap around $1.1 million in San Mateo County. Even starter properties here blow past that ceiling, so conventional is the only agency option.
Jumbo conventionals overlap heavily with standard conventional in this market. The distinction matters for underwriting but less for borrowers. Same credit standards, same documentation, just different investor requirements.
Bank statement programs exist for self-employed buyers who can't show traditional income. We avoid those when possible because rates run 1-1.5% higher than conventional. Tax returns work better if you can qualify.
Property taxes run higher here than most Bay Area cities, which affects DTI calculations. Expect $20,000-$40,000 annually, and lenders count the full amount in your debt ratio even if you escrow.
HOA fees are minimal or nonexistent since most properties are single-family estates. That helps DTI compared to San Francisco condos, but insurance costs offset the benefit. Budget $5,000+ annually for coverage.
Hillsborough has strict building codes and covenant restrictions that can complicate renovations. Lenders want sign-off that planned work meets town standards before approving renovation loans or construction financing.
Minimum is 620, but you need 700+ to get approved on high-balance amounts. Rates improve significantly above 740, which saves thousands annually on million-dollar loans.
Conventional loans allow 3% down, but Hillsborough buyers typically put 20-30% to avoid PMI and secure better rates. Jumbo lenders above conforming limits expect at least 20%.
Most properties here exceed the conforming loan limit around $832,750. Anything above that requires jumbo conventional financing, which has stricter credit and reserve requirements.
Expect 30-45 days from application to closing. Appraisals take 3-4 weeks in Hillsborough due to limited comparable sales, so start the process early.
ARMs save 0.375-0.5% on rates compared to 30-year fixed. A 7/1 ARM works well if you plan to move or refinance within seven years, which most Hillsborough buyers do.
Yes, with two years of tax returns showing stable income. If your returns don't reflect full earnings, bank statement programs exist but cost 1-1.5% more in rate.