Conventional Home Loans
in California

Requirements for Conventional loans are more stringent than the government-backed options like VA, USDA, and FHA loans:

• Applicants must be at least 18 years of age.
• Constant employment – general rule you have to work for two years in the same field/position – with proven income, Paystubs, and W2’s.
• Tax returns are needed if there’s self-employed income or other real estate owned.
• You have to be at least a 620 FICO score.
• Loan amount limits vary by county (e.g., $822,375 in LA/Orange vs. $548,250 most counties). Limits change annually; check with a professional.
• Minimum, 3% of the purchase price, is required as down payments.* Subject to the borrower’s debt to income ratio and credit score.
• Whenever the down payment is below 20%, Lenders will require Mortgage Insurance (PMI).
• Home-ownership education Might be required for at least one borrower when all occupying borrowers are first-time home-buyers.

Pros:

• You can avoid Mortgage Insurance with a 20% Downpayment.
• Compared to other programs conventional loans have lower monthly mortgage insurance, especially for applicants with larger down payment / higher credit score.
• No upfront mortgage insurance premium – Borrower Paid Monthly Options available.
• Possibility to finance even Investment Property or a Second Home!

Cons:

• Slightly higher interest rates when it comes to some of the governmental programs…
• More stringent guidelines in regards to the credit and down payment requirements compared with FHA loans.

The bank will use the lowest middle credit score between you two the middle score from each bureau.

The qualifications for a mortgage as a permanent resident an alien under all conventional loan programs are roughly the same as for the U.S citizen. The only difference is the applicant will need to provide a current, unexpired green card to the loan officer. A lawful permanent resident is rightfully recognized and legally registered as having permanent residency in the United States as an immigrant. Legal permanent residents are issued a Form I-551 or Permanent Resident Card ordinarily called a “Green Card,” permitting them to live and work permanently in the U.S.

An applicant with valid Employment Authorization and residency in the U.S. will obtain conventional funding with the same rates and terms as a United States citizen.

Conventional loans allow you to purchase Condos, SFR’s (single-family homes), townhomes, lofts, and most 1-4 Residential Unit Properties.

The mortgage interest rate you qualify for is based on the risk factor you present to the lender. That risk level is defined primarily by the following determinants:

1) The current bond market
2) Down payment
3) Credit scores
4) Mortgage insurance factor
5) Type of loan

All these consolidated constituents play a role in the interest rate you’re getting from the lender. Please contact our professional team should you have more questions on the mortgage rates to guide you on the best rates.