Conforming Loan Limits In California

A Conforming loan is a mortgage loan that “conforms” to the underwriting standards of Fannie Mae or Freddie Mac. All Conforming loans go through an Automated Underwriting System (AUS) prior to an actual underwriter reviewing the file.

Conforming loan limits in California are the maximum loan amount a lender can lend under current Conforming guidelines.

A Conforming loan is a Conventional Loan and a Conventional loan is any mortgage loan that is not backed by the U.S. Government. FHA home loans and VA home loans are backed by the U.S. government and are not Conforming nor are they Conventional loans.

The most popular Conforming loans are the 30-year Fixed-Rate Mortgage (FRM) loans and the 15-year fixed-rate loan. Most homeowners or homebuyers go with either a 30-year or 15-year fixed-rate program however there are many other options. Here is a full list of all the fixed-rate mortgage options with Conforming loan limits.

If you have a credit score above 700 and a debt-to-income ratio below 50% than a Conforming loan might be right for you even if you only have 3% down or 3% equity (if you’re refinancing).

Conforming loans offer some of the best mortgage rates and for those that have less than 20% down (or equity) you’ll have a lower Mortgage Insurance (MI) cost.

In addition to the lower MI cost, you’ll be able to get rid of the MI whereas on an FHA loan it’s permanent.