Path 01
Standard 97
A targeted 3% path for an eligible first-time buyer.
At least one borrower must be a first-time buyer. It is fixed-rate, no longer than 30 years, for a one-unit principal residence. High-balance loans and ARMs are excluded.
California loan guide · Conventional
Conventional loans, without the shortcuts.
We explain the 2026 California limits, the real difference between automated and manual credit rules, down-payment paths, PMI cancellation, and the details that change a file.
Educational guidance only. Current agency, investor, and lender requirements may be stricter and a complete application controls eligibility.
At a glanceCalifornia · 2026
- 2026 baseline
- $832,750One-unit conforming limit in 41 California counties.
- California ceiling
- $1,249,125One-unit maximum in 10 high-cost counties.
- Low-down paths
- 3% or 5%Program eligibility, occupancy and income rules differ.
- Credit
- DU ≠ manualDU has no published minimum; manual floors are 620 fixed / 640 ARM.
01 · The definition
What makes a mortgage conventional?
A conventional mortgage is not insured or guaranteed by FHA, VA, or another federal housing program. “Conforming” is a narrower label: it means the loan fits the acquisition rules and size limits used by Fannie Mae or Freddie Mac.
Fannie Mae and Freddie Mac purchase qualifying mortgages from lenders, creating a shared framework for underwriting and delivery. A loan can still be conventional but non-conforming when its balance or features fall outside that framework; jumbo is the familiar example.
California has three 2026 one-unit tiers: 41 baseline counties at $832,750, seven intermediate counties from $897,000 to $1,104,000, and 10 ceiling counties at $1,249,125. County and unit count set the limit, which is neither a price cap nor an approval amount.
Conventional financing may cover a primary home, qualifying second home, or investment property. First-time-buyer history, income, occupancy, property count, and baseline-versus-high-balance status can change the available path.
02 · Credit score
The universal “620 minimum” is not the full rule.
A credit score is only one input, and automated underwriting is not governed by the same published minimum as a manually underwritten file.
Fannie Mae · B3-5.1-01 · 04/22/2026
“A minimum credit score is not required for DU loan casefiles.”
This does not mean credit is ignored or every score is eligible. DU evaluates the complete casefile; lenders and investors may be stricter.
The same guide sets manual minimums at 620 for fixed-rate and 640 for ARM loans. Those manual figures are often mislabeled as universal.
Review the credit report, full application and AUS findings before drawing a conclusion. A score cannot replace the rest of the file.
Fannie Mae’s automated and manual rules are starting points, not a result for a particular borrower. The lender or investor reviewing the file may require more.
03 · 2026 county limits
California has three conforming-limit tiers—not two.
California’s 2026 one-unit limits are $832,750 in 41 baseline counties, $897,000–$1,104,000 in seven intermediate counties, and $1,249,125 in 10 ceiling counties. Search by county or filter by tier.
41
Baseline counties
$832,750 one-unit limit
7
Intermediate counties
$897,000–$1,104,000 one-unit limits
10
Ceiling counties
$1,249,125 one-unit limit
Showing 10 of 58 California counties
| County | Tier | 2026 · 1 unit | 2 units | 3 units | 4 units |
|---|---|---|---|---|---|
| Alameda | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| Alpine | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Amador | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Butte | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Calaveras | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Colusa | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Contra Costa | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| Del Norte | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| El Dorado | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Fresno | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Glenn | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Humboldt | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Imperial | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Inyo | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Kern | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Kings | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Lake | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Lassen | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Los Angeles | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| Madera | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Marin | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| Mariposa | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Mendocino | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Merced | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Modoc | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Mono | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Monterey | Intermediate | $994,750 | $1,273,450 | $1,539,350 | $1,913,000 |
| Napa | Intermediate | $1,017,750 | $1,302,900 | $1,574,900 | $1,957,250 |
| Nevada | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Orange | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| Placer | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Plumas | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Riverside | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Sacramento | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| San Benito | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| San Bernardino | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| San Diego | Intermediate | $1,104,000 | $1,413,350 | $1,708,400 | $2,123,100 |
| San Francisco | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| San Joaquin | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| San Luis Obispo | Intermediate | $1,000,500 | $1,280,850 | $1,548,250 | $1,924,100 |
| San Mateo | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| Santa Barbara | Intermediate | $941,850 | $1,205,750 | $1,457,450 | $1,811,300 |
| Santa Clara | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| Santa Cruz | Ceiling | $1,249,125 | $1,599,375 | $1,933,200 | $2,402,625 |
| Shasta | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Sierra | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Siskiyou | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Solano | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Sonoma | Intermediate | $897,000 | $1,148,350 | $1,388,050 | $1,725,050 |
| Stanislaus | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Sutter | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Tehama | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Trinity | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Tulare | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Tuolumne | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Ventura | Intermediate | $1,035,000 | $1,325,000 | $1,601,600 | $1,990,450 |
| Yolo | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
| Yuba | Baseline | $832,750 | $1,066,250 | $1,288,800 | $1,601,750 |
04 · Down-payment paths
“3% down” is a family of programs, not one rule.
Each path below has its own first-time-buyer, income, occupancy and loan-feature tests. A low down payment does not remove underwriting, mortgage insurance or closing-cost requirements.
Path 02
HomeReady
A Fannie Mae path with an income limit, not a first-time-buyer requirement.
Qualifying income may not exceed 80% of area median income. First-time-buyer status is not required; education applies in specified first-time-buyer cases.
Path 03
Home Possible
A Freddie Mac low-down-payment path for qualifying households.
Qualifying income may not exceed 80% of area median income. The published path reaches 97% LTV for an eligible one-unit, fixed-rate primary residence.
Path 04
HomeOne
A Freddie Mac 3% option without an income cap.
At least one borrower must be a first-time buyer. The property is a one-unit primary residence and the mortgage is fixed-rate.
Path 05
Standard 5% path
A broader starting point when a named 3% program does not fit.
No first-time-buyer or program income test. Your maximum LTV depends on the current eligibility matrix and high-balance treatment, so it needs to be checked for the specific loan.
California high-balance cliff
Standard 97 closes above $832,750—even in a $1,249,125 ceiling county.
Ceiling counties reach $1,249,125, but a loan above the $832,750 national baseline is high-balance. Standard 97 excludes high-balance loans, closing that 3% path above the baseline.
This applies only to Standard 97 and should not be generalized to another low-down-payment program. Loan amount—not price—crosses the threshold.
Standard 97 restrictions: Fannie Mae B2-1.3-01. Source
For an occupying purchaser, Fannie Mae’s three-year lookback says the person “had no ownership interest (sole or joint) in a residential property during the three-year period preceding the date of the purchase of the security property.” Separate provisions cover displaced homemakers and single parents. HomeReady has no first-time-buyer requirement; Freddie Mac paths have their own tests. FannieHomeReadyFreddie
05 · Private mortgage insurance
PMI cancellation has two different clocks.
Private mortgage insurance is generally required above 80% LTV. The federal Homeowners Protection Act uses original value; an investor’s current-value cancellation process is a separate route.
Federal HPA · original value
Borrower request at 80%; automatic termination at 78%.
A borrower may request cancellation when the balance is scheduled to reach 80% of original value, or reaches it sooner. The written request carries current-payment, history, lien and value conditions.
Automatic termination occurs at a scheduled 78% when current; final termination applies at the amortization midpoint. Coverage and timing still depend on the Act.
Investor process · current value
A later appraisal is not the same cancellation right.
An investor process may use current value, a new valuation, seasoning, payment history and equity tests. It does not rewrite HPA’s original-value rules.
Ask the servicer which process applies and what evidence is required before paying for a valuation.
Federal statutory framework and CFPB consumer guidance. 12 U.S.C.CFPB A generic PMI percentage would not be a verified estimate for your file. Compare the actual disclosure or quote instead.
06 · Side-by-side
Conventional and FHA solve different constraints.
Neither label is automatically “better.” The useful comparison is the one tied to a borrower’s credit profile, cash, property, county, occupancy and long-term mortgage-insurance plan.
| Feature | Conventional | FHA |
|---|---|---|
| Minimum down payment | Named paths may begin at 3%; standard may begin at 5%. | 3.5% at a qualifying score of 580+; 10% at 500–579. |
| Credit | DU has no published minimum; manual: 620 fixed / 640 ARM. | FHA qualifying-score tiers begin at 580 and 500–579. |
| Mortgage insurance | PMI has HPA and investor cancellation paths. | MIP: 11 years at ≤90% LTV; term above 90%. |
| Occupancy | Primary, qualifying second home, or investment. | Primary residence with limited exceptions. |
| 2026 Sacramento limit | $832,750 · one unit. | $764,750 · one unit. |
See how these rules interact across both programs in our complete FHA vs. conventional comparison.
07 · Seller contributions and gifts
Who can bring funds—and what those funds may cover.
A seller contribution and a gift are not substitutes for the borrower’s required down payment in every situation. The source, property, LTV and documentation determine the treatment.
Interested-party contributions
For a primary or second home, maximum IPC is 3% above 90% LTV, 6% from 75.01%–90%, and 9% at 75% or below. Investment property is 2%. IPCs can cover permitted costs, not down payment or reserves; excess reduces the price used for LTV. Source
| Occupancy / LTV | Maximum IPC |
|---|---|
| Primary or second home · above 90% | 3% |
| Primary or second home · 75.01%–90% | 6% |
| Primary or second home · 75% or below | 9% |
| Investment property · any LTV | 2% |
Gift funds
The February 2026 guide recognizes relatives, domestic partners, fiancé(e)s, former relatives, and long-standing familial-like or mentorship relationships. The donor cannot be an interested party.
Eligible primary and second homes may use documented gifts; investment properties may not. The letter and transfer evidence identify the parties, relationship, amount, source and no repayment.
The relationship and donor independence matter. Source
08 · Occupancy and property count
Conventional financing extends beyond a primary home.
Occupancy changes the available terms, reserves, pricing and underwriting. The category must describe how the property will actually be used.
Principal residence
The borrower occupies the property as a primary home, subject to narrow alternatives in the guide.
Second home
A one-unit, year-round property occupied part of the year and controlled exclusively—not a rental or timeshare.
Investment property
A non-owner-occupied property may be eligible through DU with investment-property rules and reserves.
09 · Frequently asked
Questions the one-line eligibility lists miss.
These answers explain the agency rules. A loan officer still needs the complete scenario and current findings before discussing eligibility.
Do all conventional loans require a 620 credit score?
No. Fannie Mae publishes no minimum for DU casefiles. The 620 fixed and 640 ARM figures apply to manual underwriting. A DU finding is not a final loan decision; lender or investor rules may be stricter.
Who counts as a first-time homebuyer?
For Standard 97, the occupying purchaser generally had no residential ownership interest during the prior three years. Separate provisions address displaced homemakers and single parents.
Can I use Standard 97 above the $832,750 national baseline limit in Los Angeles or Orange County?
No. A loan above the 2026 baseline of $832,750 is high-balance, which Standard 97 excludes. That answer applies only to Standard 97.
Does the county limit tell me how much I will be approved to borrow?
No. It is an agency acquisition limit, not an approval amount. The complete borrower, property, underwriting and lender review still controls.
Does PMI always disappear as soon as I have 20% equity?
Not necessarily. HPA rights use original value and balance milestones; an investor’s current-value path can require a later valuation and separate conditions.
Can gift funds be used for an investment-property purchase?
No under the personal-gift rule summarized here. Eligible primary and second homes may accept documented gifts; investment properties may not.
Can a conventional loan finance a second home or investment property?
Yes. Primary, qualifying second-home and investment transactions have different rules. DU caps financed properties at 10 for second-home and investment transactions.
Next step · low commitment
Turn the rules into the right questions.
Bring the county, unit count, occupancy, estimated purchase price, ownership history and available funds. We can help identify which current conventional path deserves a complete review—without treating this guide as a preapproval.
Sources (10) — the official documents behind every figure on this page
- 012026 conforming loan limits— FHFA · Nov. 25, 2025
- 02Credit-score requirements (B3-5.1-01)— Fannie Mae · April 22, 2026
- 03Purchase transactions (B2-1.3-01)— Fannie Mae · Nov. 5, 2025
- 04HomeReady eligibility (B5-6-01)— Fannie Mae · Jun. 4, 2025
- 05Home Possible and HomeOne— Freddie Mac · Feb. / Sep. 2025–26
- 06Homeowners Protection Act (§§ 4901–4902)— U.S. Code · federal text
- 07Removing private mortgage insurance— CFPB · updated Jun. 30, 2025
- 08Interested party contributions (B3-4.1-02)— Fannie Mae · May 7, 2025
- 09Personal gifts (B3-4.3-04)— Fannie Mae · Feb. 4, 2026
- 10Occupancy and financed properties— Fannie Mae · Oct. 2022 / Nov. 2025
This page provides general education, not an offer, approval, commitment to lend, or complete statement of any program. Agency guidance can change, and investor or lender requirements may be stricter. Eligibility, costs, terms, and available programs depend on a complete application and current rules.