Buying in Santa Monica often means shopping above typical price points. If you are eyeing a coastal home or condo, there is a good chance you will need a jumbo mortgage. That can raise questions about down payment, documentation, and how rates really work.
In this guide, you will learn what counts as a jumbo loan in Los Angeles County, how lenders underwrite these loans, what affects jumbo rates, and how to compare your options with confidence. You will also get a clear checklist to get jumbo‑ready and condo‑specific tips that matter on the Westside. Let’s dive in.
What counts as a jumbo in Santa Monica
A jumbo mortgage is any loan amount above the conforming loan limit set by the Federal Housing Finance Agency for your county and property type. These loans are not purchased by Fannie Mae or Freddie Mac, so lenders underwrite and price them differently.
For the 2024 reporting year, the national baseline conforming limit for a one‑unit home was $766,550, and the high‑cost ceiling was $1,149,825. Los Angeles County has historically been treated as a high‑cost area. If the loan amount you need is above the current Los Angeles County conforming limit for your property type, you are in jumbo territory.
Limits update annually. Before you write an offer, confirm the current county number using the FHFA’s official resources. You can review the latest conforming loan limits page and county map on the FHFA site: check the current table on the FHFA’s Conforming Loan Limits page and verify your county on the FHFA Conforming Loan Limits Map.
- Check the latest table: FHFA Conforming Loan Limits
- Verify by county and property type: FHFA Loan Limits Map
Jumbo underwriting at a glance
Jumbo loans usually require stronger borrower profiles and more documentation than conforming loans. Standards vary by lender, so expect some differences as you shop.
Credit and score
- Best pricing typically starts at 720–760+ FICO.
- Some programs consider scores near 700, often with added cost.
- Lenders pay close attention to recent credit performance and large deposits.
Income and documentation
- Wage earners: two years of W‑2s and 1040s, plus recent pay stubs and 2–3 months of bank statements.
- Self‑employed: two years of personal and business tax returns, year‑to‑date P&L, and sometimes business bank statements. Non‑QM options may use 12–24 months of bank statements.
- Assets: statements for bank and investment accounts, and documentation for gift funds if used.
Down payment, LTV, and reserves
- Typical maximum loan‑to‑value for primary residences falls in the 75–80% range. Up to 80–90% can be possible for top borrowers on select programs, but it is less common.
- Second homes and investment properties often cap at 70–75% LTV.
- Expect 6–12 months of PITI reserves in liquid or verifiable assets. Higher LTVs or non‑QM programs may require more.
Debt‑to‑income ratio
- Many jumbo programs target a maximum DTI of 43–50%. Lower DTI helps with pricing and approval at higher LTVs.
Appraisals and valuation
- Full appraisals are standard. High‑value or unique properties can require a second appraisal or a review.
- In fast‑moving coastal markets, appraisal gaps can occur. Plan for potential renegotiation or added cash to close if the value comes in low.
Santa Monica condos: warrantable vs non‑warrantable
Condos play a big role in Santa Monica buying. Lender approval of the condo project can shape your options.
- Warrantable condos: meet common project standards such as owner‑occupancy minimums, limited commercial space, adequate reserves, and no major litigation.
- Non‑warrantable condos: may have higher investor concentration, ongoing litigation, or low reserves. These often require portfolio or non‑QM jumbo programs, larger down payments, and higher rates.
Tips for a smoother condo loan:
- Ask for HOA docs early, including budgets, reserves, and litigation disclosures.
- Request the condo questionnaire and share it with prospective lenders before you remove contingencies.
- If a project is non‑warrantable, confirm down payment, rate, and reserve expectations up front.
What drives jumbo rates
Jumbo pricing reflects both your profile and the broader market. Small changes can move your rate and costs.
Borrower and loan factors
- Credit score: the single biggest pricing driver.
- LTV and loan size: higher LTVs and larger loan amounts can increase the rate.
- Occupancy and property type: second homes and investment properties usually price higher.
- Term and structure: 30‑year fixed rates are often higher than 15‑year fixed. ARMs can offer lower initial rates but include reset risk.
- Documentation type: full‑doc pricing is typically better than bank‑statement or other non‑QM programs.
Market and lender factors
- Treasury yields: when Treasury yields rise, mortgage rates often follow.
- Federal Reserve policy: affects short‑term rates and market spreads.
- Lender liquidity and strategy: banks that hold loans in portfolio can price differently than lenders selling to investors.
Historically, jumbo rates can be similar to conforming rates in calm markets. At other times, jumbos carry a premium. The only way to know where you stand is to collect multiple written quotes.
How to compare jumbo offers
Ask at least three lenders for detailed, written Loan Estimates. Compare more than the note rate. Review the APR, points, fees, lock period, and required reserves side by side. The CFPB’s resource on the Loan Estimate can help you understand each line item and make apples‑to‑apples comparisons: CFPB guide to the Loan Estimate.
What to request and compare:
- Note rate and APR, including points and lender fees
- Lock period and float policy
- Required reserves, documentation type, and underwriting timelines
- Appraisal and third‑party fees
- Scenarios at multiple LTVs, for example 80%, 75%, and 70%
Product and lender options
You have several pathways to a jumbo loan. Your best fit depends on your credit, income profile, property type, and goals.
- Conventional jumbo programs: agency‑style underwriting, competitive rates for strong borrowers, standard documentation.
- Portfolio lenders, banks, and credit unions: hold loans in‑house, may be more flexible on unique properties or non‑warrantable condos, pricing varies.
- Non‑QM lenders: alternate income documentation, for example bank‑statement programs, higher rates and fees.
- Private bank or wealth management: relationship‑based jumbo solutions for high‑asset clients.
- Fixed vs ARM: ARMs can reduce initial payments if you plan a shorter hold period, but carry reset risk.
Costs and timelines to expect
Jumbo loans can take longer to close than conforming loans. Build a realistic schedule into your purchase strategy.
- Timeline: plan for 30–45 days to close. Allow more time for complex income, non‑warrantable condos, or unique properties.
- Fees: expect standard closing costs. Appraisals and specialty reports on high‑value homes can cost more.
- Mortgage insurance: traditional private mortgage insurance is usually not available for jumbos. Larger down payments or a piggyback second lien may be used instead, depending on lender.
Your jumbo‑ready checklist
Use this checklist to prepare before you shop and to keep your file moving once you are in escrow.
- Confirm current FHFA limits for Los Angeles County and your property type.
- Price scenarios at 80%, 75%, and 70% LTV to see rate and payment tradeoffs.
- Gather documentation:
- Two years of personal tax returns and W‑2s if applicable
- Two years of business tax returns and a year‑to‑date P&L if self‑employed
- Two to three months of bank and investment account statements
- Explanatory letters for large or unusual deposits
- ID and, for refinances, current mortgage statements
- Evidence of required reserves equal to 6–12 months of PITI
- Condo buyers, request HOA budgets, reserves, litigation info, and the condo questionnaire.
- Ask lenders about overlays, condo approval standards, and underwriting timelines.
- Collect and compare at least three written Loan Estimates.
Local insight for Santa Monica buyers
High‑demand coastal homes and condos can push loan amounts above conforming limits, which is why jumbo financing is common in Santa Monica. Unique or architecturally distinct properties may require extra appraisal review, and condos can hinge on project warrantability. Planning for reserves, ordering HOA docs early, and shopping multiple lenders will help you secure stronger terms and keep your closing on track.
If you are weighing neighborhoods or property types on the Westside, a local guide can help you align budget, financing, and timeline with the right search strategy. When you are ready to talk through options, connect with Steven Kirshbaum for a low‑pressure, local perspective that fits your goals.
FAQs
How much down payment is typical for a Santa Monica jumbo loan?
- Many conventional jumbo programs expect 20% down for primary residences, with 25–30% common for second homes or non‑warrantable condos. Select programs may allow 10–20% for highly qualified borrowers.
What credit score do I need for a jumbo mortgage in Los Angeles County?
- Best pricing often starts at 720–760+, though some lenders may consider around 700 with added cost, while non‑QM options can allow lower scores at higher rates.
Are Santa Monica condos harder to finance with a jumbo loan?
- It depends on warrantability. Non‑warrantable projects can limit lender choices and usually require larger down payments and higher rates, so review HOA docs early.
How long does a jumbo loan take to close in coastal Los Angeles?
- Plan for 30–45 days, and allow extra time for complex income, non‑warrantable condos, or unique properties that might require additional appraisal review.
How do jumbo rates compare to conforming rates right now?
- It varies by market conditions and your profile. Jumbos can match conforming rates in stable periods or carry a premium, which is why multiple written quotes are essential.
Can self‑employed buyers qualify for a jumbo loan in Santa Monica?
- Yes. Full‑doc approvals use tax returns, and some non‑QM programs use 12–24 months of bank statements, though rates and down payment needs are typically higher.
What happens if the appraisal comes in below the purchase price on a jumbo loan?
- You can try to renegotiate, bring more cash to close, request a reconsideration or second appraisal, or cancel if your appraisal contingency allows.
