Question 1

What loan types are most common in Los Gatos?

Accepted Answer

Jumbo loans are the workhorse here. Most Los Gatos homes price well above conforming limits, so conventional jumbo is where most deals start.

Question 2

What is the conforming loan limit in Santa Clara County?

Accepted Answer

Santa Clara County qualifies for high-balance conforming limits. As of April 2026, that limit is $1,089,300 for a single-unit property.

Question 3

Do I need a jumbo loan to buy in Los Gatos?

Accepted Answer

Almost certainly, yes. Los Gatos prices regularly exceed $1.5M. Anything above the high-balance conforming limit requires jumbo financing.

Question 4

What credit score do I need for a jumbo loan?

Accepted Answer

Most jumbo lenders want 700 or higher. Some programs allow 680, but you'll see better rates and terms above 740.

Question 5

How much do I need to put down on a jumbo loan?

Accepted Answer

Expect a minimum of 10–20% down for jumbo loans. Some lenders go to 10% with strong reserves and a high credit score.

Question 6

What are cash reserves and why do jumbo lenders care?

Accepted Answer

Reserves are liquid assets left over after closing. Jumbo lenders typically want 6–12 months of mortgage payments sitting in your accounts.

Question 7

I'm self-employed. Can I still get a mortgage in Los Gatos?

Accepted Answer

Yes. Bank statement loans, 1099 loans, and P&L loans exist specifically for this. You skip tax returns and qualify on actual cash flow instead.

Question 8

What is a bank statement loan?

Accepted Answer

It's a non-QM loan where lenders use 12–24 months of bank deposits to verify income. No W-2s or tax returns required.

Question 9

What is a 1099 loan?

Accepted Answer

A 1099 loan lets contractors and freelancers qualify using 1099 forms instead of full tax returns. It's common for tech consultants in this area.

Question 10

What is an asset depletion loan?

Accepted Answer

Lenders divide your liquid assets over a set term to calculate monthly income. Useful if you're retired or hold significant investment accounts.

Question 11

What is a DSCR loan and who uses it in Los Gatos?

Accepted Answer

DSCR stands for Debt Service Coverage Ratio. Investors use it to qualify on rental income — not personal income — when buying investment properties.

Question 12

Can I use a bridge loan to buy before selling my current home?

Accepted Answer

Yes. A bridge loan taps your existing home's equity to fund the new purchase. It's popular in competitive markets where timing is critical.

Question 13

What is an interest-only loan?

Accepted Answer

You pay only interest for a set period, typically 5–10 years. Monthly payments are lower, but you're not building equity during that time.

Question 14

What is a portfolio ARM?

Accepted Answer

A portfolio ARM is an adjustable-rate mortgage held by the lender — not sold to the market. They often have more flexible qualification criteria.

Question 15

What's the difference between FHA and conventional loans?

Accepted Answer

FHA requires just 3.5% down and accepts lower credit scores. Conventional loans avoid mortgage insurance if you put 20% down.

Question 16

Can I use an FHA loan in Los Gatos?

Accepted Answer

FHA loans have loan limits. In Santa Clara County, the FHA limit sits at $1,089,300. Most Los Gatos homes exceed that, ruling out FHA.

Question 17

What is a VA loan and who qualifies?

Accepted Answer

VA loans are for active military, veterans, and eligible surviving spouses. No down payment required, and there's no mortgage insurance.

Question 18

Are VA loans useful in a high-priced market like Los Gatos?

Accepted Answer

VA loans have no set loan limit for eligible borrowers with full entitlement. A veteran could finance a Los Gatos home with zero down.

Question 19

What is a HELOC?

Accepted Answer

A HELOC is a Home Equity Line of Credit. It's a revolving credit line secured by your home — useful for renovations or short-term cash needs.

Question 20

What is a home equity loan?

Accepted Answer

A home equity loan gives you a lump sum at a fixed rate, secured by your equity. Different from a HELOC, which is a flexible line of credit.

Question 21

What is a construction loan?

Accepted Answer

A construction loan funds building a home from the ground up. Funds are released in stages as construction hits set milestones.

Question 22

What documents do I need to apply for a mortgage?

Accepted Answer

Typically: two years of tax returns, W-2s, pay stubs, bank statements, and a government-issued ID. Jumbo loans often require more documentation.

Question 23

How long does mortgage approval take in California?

Accepted Answer

Pre-approval can happen in 24–48 hours. Full underwriting and closing typically takes 21–30 days for conventional and jumbo loans.

Question 24

What is the difference between pre-qualification and pre-approval?

Accepted Answer

Pre-qualification is a quick estimate based on what you tell us. Pre-approval involves verified documents and carries real weight with sellers.

Question 25

What is DTI and how does it affect my approval?

Accepted Answer

DTI is Debt-to-Income ratio — your monthly debts divided by gross income. Most lenders cap DTI at 43–45% for jumbo loans.

Question 26

What closing costs should I expect in Los Gatos?

Accepted Answer

Budget 1–2% of the loan amount for closing costs. On a $1.5M purchase, that's $15,000–$30,000 in addition to your down payment.

Question 27

What is PMI and when do I have to pay it?

Accepted Answer

PMI is private mortgage insurance. You pay it on conventional loans when your down payment is under 20%. It drops off once you hit 20% equity.

Question 28

Do jumbo loans require PMI?

Accepted Answer

Most jumbo lenders don't require traditional PMI. However, loans under 20% down may carry a higher rate to offset that risk.

Question 29

What are mortgage points?

Accepted Answer

One point equals 1% of the loan amount paid upfront to lower your rate. On a $1.5M loan, one point costs $15,000.

Question 30

Should I buy points on a jumbo loan?

Accepted Answer

It depends on how long you plan to hold the loan. Run a break-even analysis — if you'll be there 7+ years, buying points often makes sense.

Question 31

What is an adjustable-rate mortgage?

Accepted Answer

An ARM has a fixed rate for an initial period — say 5 or 7 years — then adjusts annually. They often start lower than fixed rates.

Question 32

Are ARMs a good fit for Los Gatos buyers?

Accepted Answer

For high earners who plan to move or refinance within 5–7 years, a 7/1 ARM can save real money. Rates vary by borrower profile and market conditions.

Question 33

What is a reverse mortgage?

Accepted Answer

A reverse mortgage lets homeowners 62 and older convert home equity into cash. No monthly payment is required while you live in the home.

Question 34

What is an ITIN loan?

Accepted Answer

ITIN loans allow borrowers without a Social Security number to qualify using an Individual Taxpayer Identification Number instead.

Question 35

What is a foreign national loan?

Accepted Answer

Foreign national loans are for non-US citizens buying property in the US. Documentation and down payment requirements are typically stricter.

Question 36

What is a profit and loss statement loan?

Accepted Answer

A P&L loan uses a CPA-prepared profit and loss statement to verify income. It's a clean alternative for self-employed borrowers with complex returns.

Question 37

How does SRK CAPITAL find me the best rate?

Accepted Answer

We shop your file across 200+ wholesale lenders simultaneously. You get competing offers — not just one bank's take on what you qualify for.

Question 38

Is Los Gatos in a USDA-eligible area?

Accepted Answer

No. Los Gatos is an urban Santa Clara County city. USDA loans require rural or semi-rural areas — this market doesn't qualify.

Question 39

What makes Los Gatos different from other Silicon Valley cities?

Accepted Answer

Los Gatos has a small-town feel with top-rated schools and limited inventory. That combination keeps prices high and competition intense.

Question 40

How do I start the mortgage process with SRK CAPITAL?

Accepted Answer

Reach out and we'll review your income, assets, and goals in one call. From there, we identify the right loan type and start shopping lenders.

Mortgage FAQs for Los Gatos, CA Homebuyers