South Bay Office - 650-479-5660
North Bay Office 415-515-9351
Dan Joy Realty & Alliance Home Loans Group, Inc.
DBA: Joy Realty Services
Dan Joy Himself

DRE# 01489244/NMLS# 1991474
Corp. DRE Lic. #02137466

Traditional Loans

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What are conventional loan requirements?

A conventional loan used to require 20% and 15% down payment, but now programs exist that are more flexible.

2020 conforming loan limits for CA high-cost counties surrounding the Bay Area and throughout is $765,600 for a single family home; $980,325 for a duplex; $1,984,525 for a triplex; and $1,472,550 for a quadruplex. Contact me for pricing.

A conventional loan is a mortgage product that is not insured by the federal government. Once you go beyond the county limit, it becomes a jumbo loan.

Conventional 15 Year Fixed Rate Mortgages offer a fixed initial interest rate that remains the same over the entire life of the loan. The monthly payments are amortized over a 15 year period. Many borrowers utilize a 15 Year Fixed Rate Mortgage to dramatically reduce the total interest expense they will pay over the life of their loan verses a 30 Year Fixed Rate Mortgage.

Conventional 20 Year Fixed Rate Mortgages offer a fixed initial interest rate that remains the same over the entire life of the loan. The monthly payments are amortized over a 20 year period.

Conventional 30 Year Fixed Rate Mortgages offer a fixed initial interest rate that remains the same over the entire life of the loan. The monthly payments are amortized over a 30 year period. The 30 year fixed rate mortgage is the most popular loan program as it allows borrowers to fix their interest rate for 30 years and provides the lowest monthly payment compared due to the longer amortization period.

The Conventional 3/1 ARM offers a discounted fixed rate for the first 3 years of the loan with a 30 year amortization. After the 3rd year, the interest rate may adjust up or down a maximum of 2% annually, with a cap of 6% over the life of the loan. Conventional 3/1 ARM’s are also available with annual and lifetime caps of 2% and 4%, respectively but certain restrictions apply. Some Adjustable Rate Mortgages do not have a pre-payment penalty.

The Conventional 5/1 ARM offers a discounted fixed rate for the first 5 years of the loan with a 30 year amortization. This can be very appealing to a buyer because it reduces the initial monthly payment for a five year period. After the 5th year, the interest rate may adjust up or down a maximum of 2% annually, with a cap of 6% over the life of the loan. Some of my partners offer 5/1 ARM with annual and lifetime caps of 2% and 4%, and without a pre-payment penalty but certain restrictions apply.

Conventional 7/1 Adjustable Rate Mortgages [ARMs]

Perhaps the most appealing loan for the lowest monthly payment allowed, the Conventional 7/1 ARM offers a discounted fixed rate for the first 3 years of the loan with a 30 year amortization. After the 7th year, the interest rate may adjust up or down a maximum of 2% annually, with a cap of 6% over the life of the loan. Some of my partners offer 7/1 ARM with annual and lifetime caps of 2% and 4%, and without a pre-payment penalty but certain restrictions apply.

Jumbo-Non-Conforming Loan

Jumbo Loans-non-conforming Jumbo means the loan exceeds county conforming limits.
Due to COVID-19 lenders have put a squeeze on Jumbo loans but they are still available. However, due to the environment many lenders require a 30% down payment but the doors are opening again to 20% down-payment programs

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Without Dan we would’ve probably abandoned the idea of buying a home in the Bay Area. What he did for us to get the home of our dreams was nothing short of INCREDIBLE. He made sure we were clear on every step of the process, and his attention to detail was impeccable. He is one of the hardest working people we have ever met–period. Super efficient, responsive, honest, with the heart of a lion. He pulled MANY rabbits out of hats for us, and all the while he was very enjoyable to work with day to day. He always made us feel like we were his only client. You need Dan in your life if you are buying or selling. Our realtor for life!

- Marilla and Adan Pulido (US Marine Veteran)–Happy Homeowners in Half Moon Bay, CA