In most of California, the line between conforming and jumbo is $832,750.
Borrow $832,750? Conforming.
Borrow $832,751? Jumbo.
That $1 can cost you 0.5% in rate and stricter qualification.
I'm Bill McCoy (CA DRE #01212512). I place both conforming and jumbo loans daily. Here's the difference and why it matters.
What's a Conforming Loan?
A conforming loan meets Fannie Mae and Freddie Mac guidelines, including their loan limits.
2026 limits:
- Standard counties: $832,750
- High-cost counties: $1,249,125 (LA, Orange, San Diego, SF, San Mateo, Santa Clara, Ventura, and others)
Because Fannie and Freddie back these loans, lenders take on less risk. That means better rates and easier qualification for you.
What's a Jumbo Loan?
A jumbo loan exceeds conforming limits. In standard counties, that's anything over $832,750. In high-cost counties, over $1,249,125.
Jumbo loans aren't backed by Fannie or Freddie. Lenders hold the risk themselves, so they're pickier about who they lend to.
Side-by-Side Comparison
| Feature | Conforming | Jumbo |
|---|---|---|
| Loan limit | Up to $832,750 / $1,249,125 | No cap |
| Interest rate | 6.00-6.50% (2026) | 6.25-7.00% |
| Credit score | 620 minimum | 700+ typically |
| Down payment | 3-20% | 10-20% |
| DTI max | 43-50% | 38-43% |
| Reserves | 2-6 months | 6-12 months |
| Underwriting | Standard | Stricter |
What the Rate Difference Actually Costs You
Jumbo rates run 0.25-0.5% higher than conforming. Here's what that looks like on an $832K loan:
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- At 6.25% (conforming): $5,123/month
- At 6.75% (jumbo): $5,397/month
- Extra cost: $274/month = $98,640 over 30 years
That's almost $100K for crossing the conforming line by $1.
The High-Balance Sweet Spot
In high-cost counties, conforming limits go up to $1,249,125. This is a massive advantage.
Example: Buy a $1.2M home in LA County, put 20% down ($240K), and your $960K loan is still conforming. You get the 6.25% rate instead of 6.75%. That 0.5% savings adds up fast.
If you're buying in LA, Orange County, San Diego, or the Bay Area, check whether your loan stays under the high-cost limit before assuming you need jumbo. See the full county-by-county breakdown.
When Jumbo Makes Sense
Don't avoid jumbo at all costs. It's the right call when:
- You're buying coastal California where median prices top $1M
- You have 740+ credit, 20% down, and strong reserves — qualification won't be an issue
- You want to keep cash invested rather than putting extra down just to stay conforming
When Jumbo Hurts
- Credit under 720 — you'll pay a premium or get denied
- Self-employed with uneven income — jumbo underwriting is brutal on inconsistent earnings (see self-employed requirements)
- Tight on reserves — jumbo lenders want 6-12 months of payments sitting in the bank after closing
- You're barely over the conforming limit — strategies to stay under the line can save you real money
Get Your Rate Comparison
We compare jumbo options to help you review rate, terms, and fit for your situation. Whether you land in conforming or jumbo territory, we'll help you understand the tradeoffs.
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Better Offers Inc | CA DRE #01212512