The Secret Life of Jumbo Loans

Jumbo Loans – things you may not know – A loan is considered Jumbo if it is higher than the top conforming limit for a county. Below is a list of the 2021 conforming limits. You may know that most lenders sell their loans through the government, Fannie Mae or Freddie Mac once the loans are completed.

What you may not know is the government and their associates will not purchase a loan higher than that conforming county limit. In the past, most lenders would portfolio or keep Jumbo and other non-conforming loans but today, even the bigger banks have private investors that purchase those loans. As there is greater risk, or at least it is perceived that way by Jumbo investors, rates tend to be higher for Jumbos than conventional and high-balance loans.

California Conforming Loan Limits by County
California conforming loan limits have been increased for 2021. Federal housing officials announced this change on November 24, 2020. The table below has been fully updated to include the revised (increased) limits for all counties across the state.

You’ll notice that most counties within California have a 2021 conforming loan limit of $548,250, for a single-family home. Higher-priced areas, like those in the San Francisco Bay Area, have conventional limits of up to $822,375 due to higher home values. Other counties fall somewhere in between these “floor” and “ceiling” amounts.

See the table below for 2021 conforming loan limits in all California counties.

County loan limits courtesy of – www.loanlimits.org

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