San Diego Conforming Loan Limits Unveiled for 2015 – What San Diego Borrowers Need to Know?
The Federal Home Finance Agency (FHFA) has just recently announced that it is leaving its nation-wide conforming mortgage loan limits at $417,000 for a single-family home.
However, this does NOT APPLY to San Diego residents, because San Diego is one of a number of counties where homes are designated as “high cost” areas.
These counties have seen an increase in the average price of a median home so the conforming loan limits have been increased in these areas.
What Is A Conforming Loan Limit?
Conforming loan limits are set by the FHFA. These loan limits are the maximum allowable loan size for a mortgage which may be originated through Fannie Mae and Freddie Mac.
Conforming loan limits apply to conventional mortgages and this includes both purchase and refinance loans.
Any loan above the amount of the designated conforming loan limit in the county in which you reside cannot be sold to Fannie Mae or Freddie Mac, and requires that the borrower will have to apply for a “Jumbo Loan” to qualify for their mortgage instead.
Jumbo loans are not typically government backed such as through Fannie Mae or Freddie Mac. These types of loans are mostly provided through both local and national banks, or other types of lenders.
Applications for jumbo loans tend to be much more stringent for a borrower to get approved. Approval for jumbo loans generally requires that the borrower have both higher income and credit score requirements than those required for other forms of conventional mortgages.
Jumbo loans also generally require a higher down payment along with other qualifying requirements above and beyond what is required for a conventional loan.
2015 San Diego Conforming Loan Limits Have Been Increased
In 2014, the conforming loan limits for San Diego were set at $546,250.
The 2015 conforming loan limits in San Diego have now been increased to $562,350!
Mortgages that exceed the San Diego 2015 conforming loan limit of $562,350 will require the borrower to be subject to Jumbo Loan guidelines.
Keep in mind that this only affects the amount which is to be financed after the down payment is taken into account.
If you are uncertain whether you will be eligible for a conventional loan or have to apply for a jumbo loan, you can use the following calculation as a handy guideline:
Conventional Loan Scenario
If: (Price of the Home) Minus (Amount of Down Payment) is LESS than the conforming loan limit of $562,350 then you can apply for a Conventional Loan which is originated through Freddy Mac or Fannie Mae.
Jumbo Loan Scenario
If: (Price of the Home) Minus (Amount of Down Payment) is GREATER than the conforming loan limit of $562,350 then you will very likely have to apply for a Jumbo Loan.
How Can I Find Out if I Qualify for a Jumbo Loan?
The best thing you can do is to speak with a knowledgeable broker about your personal situation. There are a variety of factors to take into account and we can help you consider your options.
As an experienced San Diego Mortgage Broker, I have access to all the above loan options; traditional conforming, high balance conforming, and true jumbo loans. Rates are still exceptionally affordable and there are may options available to get you pre-approved.
Please call me at 619-312-0612 with any questions you have as we can get your mortgage application process started today.