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How Loan Amounts Affect Rates

Several factors determine your rate such as; credit score, down payment, type of property, type of loan, type of occupancy, loan amount and county you live in or are looking to purchase. In this blog, I will just concentrate on the loan amounts as they relate to rates.

There are basically two categories of loans that will determine your rate and loan program:

Conforming Loan: Loan amounts not exceeding $484,350 for Single Family Residence.

High Balance Loan: Loan amounts greater than $484,350, not exceeding $726,525 for Single Family Residence.

A loan amount exceeding $726,525 for Single Family Residence is called a Jumbo loan which is a totally different catergory and has its own sets of rulles.

There are 4 types of properties for residential loans - SFR, 2 Units, 3 Units, and 4 Units. The amount of loan limit is increased according to the number of units. Below is a table of the 2019 Loan Limits for LA and Orange Counties:

Property Type Conforming High Balance
SFR                484,350.00                  726,525.00
2 Units                620,200.00                  930,300.00
3 Units                749,650.00               1,124,475.00
4 Units                931,600.00               1,397,400.00

These loan limits apply to Conventional, FHA and VA loans. So when rate shopping, remember Conforming Loan Rates are lower than High Balance Loan Rates.

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Jonathan Caguioa

NMLS# 250609 / DRE# 01137630 Mobile: 949-241-2527

ALLIANZ MORTGAGE NMLS# 346138 / BRE# 01403147

13215 E. Penn St. PH1
Whittier, CA 90602

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