California Jumbo Loans: Complete Guide (2025)
Everything You Need to Know About Jumbo Mortgages in California
Quick Answer
California jumbo loans are required for home purchases exceeding county conforming limits, which range from $806,500 to $1,149,825 depending on location. With nearly 40% of California mortgages classified as jumbo—compared to less than 10% nationally—understanding jumbo loan requirements is essential for coastal and high-cost area buyers. Competitive jumbo rates, flexible terms, and specialized programs make California's expensive housing market accessible to qualified buyers.
California Jumbo Loan Limits by County (2025)
A jumbo loan is required when the loan amount exceeds the conforming limit set for a specific county.
When Jumbo Loans Are Required
| Counties | Conforming Limit | Jumbo Starts At |
|---|---|---|
| San Francisco, Orange, Los Angeles, San Diego, Santa Clara & other high-cost areas | $1,149,825 | $1,149,826 |
| Sacramento, Riverside, San Bernardino & other standard areas | $806,500 | $806,501 |
| Kern, Fresno, Tulare & other floor limit areas | $498,257 | $498,258 |
California Jumbo Loan Requirements
Credit Score
Minimum 680-700, but 720+ is preferred for the best rates. Scores below 700 may face higher rates and stricter requirements.
Down Payment
20% is the industry standard for the best rates. 10-15% down is possible but usually comes with higher rates and requires PMI.
Debt-to-Income (DTI) Ratio
Lenders typically cap DTI at 43%, though some may go to 45%. A lower DTI (under 40%) strengthens your application significantly.
Cash Reserves
Jumbo lenders require significant liquid assets after closing, typically 6-12 months of total monthly housing payments (PITI).
California Jumbo Loan Interest Rates
Jumbo rates have become very competitive and are often only slightly higher than conforming rates for well-qualified borrowers.
Current California Jumbo Rate Ranges (2025)
| 30-Year Fixed Jumbo | 6.50% - 7.50% |
| 15-Year Fixed Jumbo | 5.75% - 6.75% |
| 7/1 ARM Jumbo | 5.75% - 6.75% |
Types of California Jumbo Loans
Fixed-Rate Jumbo
Offers a stable interest rate and payment for the life of the loan (typically 15 or 30 years). Best for buyers planning to stay in their home long-term.
Adjustable-Rate (ARM) Jumbo
Features a lower initial interest rate for a fixed period (e.g., 5, 7, or 10 years) before adjusting. Ideal for buyers who plan to sell or refinance before the adjustment period ends.
Interest-Only Jumbo
Allows the borrower to pay only the interest for a set period, resulting in a lower initial payment. Best for sophisticated borrowers with variable income who want to maximize cash flow.
Asset-Based (Asset Qualification) Loans
Qualifies a borrower based on their liquid assets rather than traditional income. A crucial tool for entrepreneurs, retirees, or those with non-traditional income streams.
California Jumbo Loan FAQs
Can I get a jumbo loan with less than 20% down?
Yes, many California lenders offer jumbo loans with 10-15% down, but this usually requires private mortgage insurance (PMI) and results in a higher interest rate. Some specialized programs may even allow 5% down for highly qualified borrowers.
What are the reserve requirements for a jumbo loan?
Lenders typically require borrowers to have 6 to 12 months of the full monthly housing payment (PITI) in a liquid account after closing. For a $2M loan with a $13,000 monthly payment, this could mean reserves of $78,000 to $156,000.
Are jumbo loan rates higher than conventional rates?
Historically, yes. However, the gap has narrowed significantly. For borrowers with excellent credit (760+), jumbo rates can be very close to, and sometimes even match, conforming rates.
Can I use a jumbo loan for an investment property?
Yes, but the requirements are stricter. Expect to need a larger down payment (25-30%), and the interest rate will typically be 0.50% to 0.75% higher than for a primary residence.