Shopping for a Campbell home in the 1–3 million range and unsure if you’ll need a jumbo loan? You’re not alone. In Santa Clara County, many buyers discover that their target homes require financing above standard conforming limits. This guide breaks down how jumbo loans work here, what lenders expect, how rates and buydowns impact approval, and the smart moves that improve your odds. Let’s dive in.
Conforming vs. jumbo in Santa Clara County
A conforming loan meets Fannie Mae and Freddie Mac standards and stays at or below the county loan limit. Anything above that limit is considered a jumbo loan and follows investor or lender portfolio rules instead of agency guidelines. Santa Clara County is classified as a high-cost area, so its conforming limit is higher than the national baseline. Always confirm the current county limit before you shop, since it can change annually.
For many Campbell buyers targeting 1–3 million dollar homes, the needed loan amount often lands above the county threshold. Depending on your down payment and the appraisal, you may need a true jumbo even if your purchase price seems close to conforming ranges.
How jumbo loans differ
Jumbo loans are funded and priced by investors or held in lender portfolios. That creates more variation in underwriting and rates compared to conforming. You will see different rules and fees from lender to lender.
- Pricing behavior: Jumbo rates can be slightly higher than conforming, similar, or sometimes lower. It depends on investor demand and the lender’s cost of funds. Expect more variation across lenders than you see with conforming.
- LTV and mortgage insurance: Conforming loans may allow over 80 percent loan-to-value with mortgage insurance. Most jumbo programs aim for 80 percent LTV or lower for best pricing, which means a 20 percent down payment. Some portfolio lenders go to 85–90 percent LTV at higher rates with stricter credit and reserve requirements.
- Product variety: You will find both fixed-rate and ARM options. Some portfolio lenders also offer specialty programs, including interest-only or bank-statement options, typically at higher rates and with tighter reserves.
What lenders look for on 1–3M jumbos
Guidelines vary, but these are common ranges you will see in Santa Clara County.
Down payment and LTV
- Best pricing: Aim for 20 percent down or more, especially as loan amounts push closer to 2–3 million.
- Lower-down options: Some lenders allow 10–15 percent down, but expect stronger credit, higher rates, and larger reserves.
- Higher amounts: Loans above 2 million often include stricter LTV and reserve rules.
Credit score
- Preferred: 740+ for the best pricing and terms.
- Acceptable: 700–739 can work with many lenders. Sub-700 may be possible only with select portfolio programs and higher pricing.
Debt-to-income ratio
- Typical maximums: 38–45 percent depending on lender and compensating factors like reserves, down payment, and credit depth.
- Qualifying approach: Lenders may require you to qualify at a rate higher than the note rate to account for payment risk.
Reserves and liquidity
- Common requirement: 6–12 months of PITI in liquid, seasoned assets is typical for jumbo loans.
- Higher-risk profiles: For larger loans, higher LTV, or variable income, 12+ months of reserves is common.
Income documentation for tech professionals
- W-2 employees: Expect standard docs like recent pay stubs, 2 years of W-2s, and employer verification.
- Equity compensation: Vested RSUs with a 1–2+ year history and clear, liquidable value are sometimes counted as income. Unvested or one-time grants usually are not considered qualifying income but may count as assets. If your vesting is variable, lenders may prefer to see substantial reserves.
- Self-employed or 1099: Lenders typically need 2 years of tax returns and will average net income per guidelines. If your taxable income is low or volatile, you may consider asset-depletion or bank-statement programs, which come with higher rates and strict reserve rules.
Appraisal and property type
- Appraisal: Jumbos require a full appraisal. In busy seasons, Santa Clara turn times can stretch, so plan for 10–14 days for ordering and review.
- Property types: Certain homes, such as unique custom properties or some condo projects, can limit product options or trigger extra scrutiny.
Rates, qualifying rates, and buydowns
Jumbo lenders set pricing using spreads over benchmarks and their own credit models. Stronger files with lower LTVs, excellent credit, and robust reserves earn better terms.
- Qualifying rate: Many lenders qualify you at a higher rate than your note rate. That means lowering your actual rate may not always reduce the qualifying rate unless the lender’s policy allows it.
- Temporary buydowns: A 2-1 or 1-0 buydown can ease your initial monthly payments, but many lenders still qualify you at the note rate or the rate after the buydown expires. Some allow partial credit. Always confirm before relying on this for approval.
- Permanent buydowns: Paying points to buy down the rate permanently lowers both your payment and, in most programs, the qualifying rate. For buyers near DTI limits, a permanent buydown can materially improve qualifying math.
Practical takeaway: If you are tight on DTI, consider a permanent buydown and verify with the lender how it impacts the underwriting rate. Use temporary buydowns for cash flow, not for qualification, unless your lender explicitly allows it.
Lender types and program paths
Jumbo eligibility and pricing vary widely, so comparison shopping matters.
- Portfolio lenders: Community banks, credit unions, and large banks that keep loans on their books can be flexible on documentation or how they treat equity compensation. Pricing and overlays can differ significantly.
- Wholesale brokers: Brokers shop multiple jumbo investors, which can uncover better pricing or more flexible rules for your profile.
- Non-QM options: If your income is nontraditional, bank-statement or asset-depletion programs may help, typically at higher rates and with stricter reserve requirements.
- Bridge or HELOC strategies: If you plan to buy before selling, a bridge loan or HELOC can help with the down payment. These affect DTI and reserves and require careful timing to keep your approval on track.
Timeline and process in Campbell
Moving parts increase with jumbos, especially if your income includes RSUs, bonuses, or self-employment.
- Pre-approval: 1–7 days depending on documentation complexity.
- Underwriting to close: 30–45 days is common, longer if the file is complex or appraisal vendors are backed up.
- Appraisal: Budget 10–14 days for ordering and review during busy periods.
Tip: Order the appraisal promptly once contingencies start, keep documentation organized, and avoid major financial changes mid-transaction.
Checklist to strengthen your jumbo approval
Use this simple, local checklist as you prepare.
- Maximize credit: Pay down revolving balances and avoid new inquiries for at least 6 months before applying.
- Target LTV: Aim for 80 percent LTV or lower for best jumbo pricing and broader lender options.
- Build reserves: Show 12+ months of PITI if you can, especially for loans above 1.5–2 million or with variable income.
- Document equity comp: Provide vesting schedules, 2-year histories of vesting, and brokerage statements showing liquidity.
- Stabilize debt: Do not take on new car loans or large purchases during the process.
- Ask smart lender questions: How do they treat RSUs, buydowns, and qualifying rate policies? What reserve requirements apply at your target loan amount and LTV?
- Get a full pre-approval: Choose a lender that regularly closes jumbos in Santa Clara County and can underwrite your file before you write offers.
- Plan funds early: Season down payment and reserves for 60–90 days when possible, and document sources like gifts or sale proceeds.
When a jumbo may not be required
In high-cost counties, some lenders offer high-balance conforming options below the county limit. If your needed loan amount fits within that cap, a high-balance conforming loan could work. This path may provide mortgage insurance options above 80 percent LTV and more standardized underwriting. If your loan size is above the limit, you will need a true jumbo.
Offer strategy for Campbell buyers
Campbell’s single-family market can be competitive, which means your financing posture matters as much as your offer price.
- Go in fully underwritten: A true pre-approval, not a quick pre-qual, carries more weight in multiple-offer situations.
- Show strength with assets: Lower LTV and strong reserves can set your offer apart and support appraisal gaps.
- Time your rate lock: Consider early locking if rates are rising and ask about float-down options. Policies vary across jumbo lenders.
- Align terms with lending: Coordinate contingencies, appraisal timing, and buydown credits so your contract matches the underwriting reality.
Strong financing can be the difference between winning and finishing second in Campbell.
If you are planning to buy in Campbell or nearby South Bay communities, we coordinate your offer strategy with your lender, help you weigh buydown trade-offs, and position your financing to compete.
Ready to move forward with a clear plan for your jumbo purchase? Connect with Brandon Gummow for a data-backed strategy that pairs strong financing posture with negotiation that wins in Santa Clara County.
FAQs
What makes a loan “jumbo” in Santa Clara County?
- A loan above the county’s conforming limit is considered jumbo and follows investor or portfolio lender rules instead of Fannie Mae or Freddie Mac guidelines.
Can I get a jumbo loan with 10 percent down?
- Sometimes, with very strong credit, lower DTI, and larger reserves, but expect higher rates, stricter documentation, and fewer lender options.
How are RSUs treated when qualifying for a jumbo?
- Vested RSUs with a documented 1–2+ year history may count as income with some lenders, while unvested or one-time grants are usually treated as assets, not qualifying income.
How many months of reserves do jumbo lenders require?
- Commonly 6–12 months of PITI, and 12+ months for higher loan amounts, higher LTVs, or variable income profiles.
Do temporary buydowns help me qualify for a jumbo?
- A temporary buydown improves early cash flow, but many lenders still qualify you at the note rate or the post-buydown rate; a permanent buydown more reliably lowers the qualifying rate.
How long does a jumbo loan take to close in Santa Clara County?
- A typical timeline is 30–45 days from contract to close, with pre-approval taking 1–7 days depending on documentation and appraisal turn times.
