Shopping in Studio City and wondering when a loan becomes “jumbo”? You are not alone. Loan limits can feel confusing, especially when list prices hover around seven figures. The good news is that a few simple numbers will tell you whether your financing falls under conforming guidelines or crosses into jumbo territory.
In this guide, you will learn the difference between conforming and jumbo loans, the current 2024 limit for Los Angeles County, and how that limit translates to purchase prices at different down payments. You will also see practical strategies that local move-up buyers use to stay flexible and competitive. Let’s dive in.
Conforming vs. jumbo loans: the basics
Conforming loans are mortgages with loan amounts at or below the maximum set for a specific county and property type. These loans follow standardized underwriting guidelines and are eligible for purchase by Fannie Mae and Freddie Mac, which helps keep pricing and requirements more uniform.
Jumbo loans are mortgages with loan amounts above the conforming limit for the county and unit count. Because jumbos are not purchased by Fannie Mae or Freddie Mac, they are funded and priced by private lenders. That means underwriting, documentation, and pricing can vary more from lender to lender.
Unit count matters. Most Studio City buyers look at 1‑unit properties, including single‑family homes and condos. Limits increase for 2–4 unit properties, but the 1‑unit number applies to most move-up purchases in the neighborhood.
2024 LA County loan limit (1‑unit)
For 2024, the Federal Housing Finance Agency set the high‑cost 1‑unit conforming loan limit for Los Angeles County at $1,149,825. The national baseline is $766,550, and high‑cost areas like LA County use a higher cap. FHFA updates these limits annually, so confirm the latest table when you are ready to get preapproved.
The limit applies to the loan amount
The conforming limit is about the loan amount, not the purchase price. Your down payment determines the loan amount you need. A higher down payment lowers the loan amount and can keep you under the limit, even when the purchase price is higher.
Turn the limit into a target price
Use this simple formula to translate the loan limit into a maximum purchase price for a given down payment:
- Maximum purchase price = Conforming loan limit ÷ (1 − down payment percentage)
Using the 2024 LA County 1‑unit limit of $1,149,825:
- 20% down: 1,149,825 ÷ 0.80 = approximately $1,437,281
- 10% down: 1,149,825 ÷ 0.90 = approximately $1,277,583
- 5% down: 1,149,825 ÷ 0.95 = approximately $1,210,342
In practice, if you plan 20% down, you can target a purchase price up to about $1.437 million and still keep the loan conforming. With less down, the conforming purchase ceiling drops accordingly.
Quick rule-of-thumb checks
- A $1.4 million purchase with 20% down equals a $1.12 million loan. That is conforming because $1.12 million is below $1,149,825.
- A $1.5 million purchase with 20% down equals a $1.2 million loan. That is jumbo because $1.2 million is above $1,149,825.
How the limit affects your plan in Studio City
Rates and pricing
Conforming loans typically benefit from standardized pricing because they are attractive to Fannie Mae and Freddie Mac investors. Jumbo loans have historically carried a slightly higher rate, but that spread moves with market conditions. At times, jumbo pricing can be competitive or even better than conforming.
What this means for you: if your target price is near the limit, compare both a conforming scenario and a jumbo scenario. A small rate difference can change your monthly payment and overall affordability.
Down payment and PMI
With conforming conventional loans, you can often put down less than 20% and use private mortgage insurance (PMI) until you reach 20% equity. Jumbo loans commonly require larger down payments, often 10% to 20%, and PMI solutions are less standardized and vary by lender.
If your goal is to avoid PMI and stay conforming, consider increasing your down payment or reducing the loan amount, possibly by timing your sale to free up more cash for the next purchase.
Credit, income, and reserves
Conforming loans use standardized underwriting for credit, debt‑to‑income (DTI), and reserves. Jumbo loans generally want stronger profiles: higher credit scores, lower DTIs, and larger cash reserves. Lenders often ask for several months of reserves, though exact amounts vary by lender and your full financial profile. Documentation for jumbo loans can be more detailed as well.
If you have strong income, a solid credit score, manageable DTI, and healthy reserves, you will likely see more jumbo options and better pricing.
Property type and occupancy
Primary residences usually get the widest and most favorable jumbo options. Condos, unique properties, and certain non‑warrantable condos can face tighter guidelines or pricing adjustments. If you are considering a condo in Studio City, ask your lender about project approval early in the process to avoid surprises.
Strategies if you are near the line
- Increase your down payment. Bringing a little more cash can keep your loan amount under the conforming cap.
- Consider short‑term financing tools. Bridge loans or HELOCs can help you buy before you sell, then reduce the permanent loan to land under the limit. Weigh the costs and risks.
- Explore a piggyback structure. Options like 80/10/10 still exist at some lenders, though they are less common and can add complexity.
- Sell first to boost cash. Using sale proceeds for a larger down payment reduces the new loan amount and may keep you conforming.
- Shop lenders. Jumbo programs and pricing can vary widely. Get quotes from multiple lenders so you can compare terms side by side.
Studio City buyer scenarios
Studio City has a wide range of homes, from condos and townhomes to hillside single‑family properties. Many move‑up purchases sit near or above the conforming threshold depending on down payment. Doing the math early helps you move fast when the right home hits the market.
A simple decision path
- Estimate your target purchase price range.
- Decide on a down payment percentage you are comfortable with.
- Calculate your likely loan amount: purchase price minus down payment.
- Compare that loan amount to $1,149,825 (2024 LA County 1‑unit limit).
- If you are at or below the limit, focus on conforming options. If you are above, prepare for jumbo underwriting.
- Get prequalified with at least one lender that can price both conforming and jumbo scenarios, so you can compare rates, cash‑to‑close, PMI, and reserve requirements.
Example: aiming for $1.45M
- At 20% down, your loan amount would be $1.16 million. That is just over the conforming cap, so it is a jumbo.
- Options to stay conforming could include increasing the down payment slightly or using short‑term funds to reduce the permanent mortgage below $1,149,825.
Example: targeting $1.3M
- At 10% down, your loan amount would be $1.17 million, which is jumbo.
- At roughly 12% down, your loan amount would drop near the conforming limit. Increasing down payment or adjusting the price slightly could shift you into conforming territory.
Next steps before you tour homes
- Get a side‑by‑side quote. Ask a lender for both conforming and jumbo estimates at your preferred price point and down payment.
- Confirm documentation needs. Clarify income, asset, and reserve requirements so you know what to expect.
- Understand PMI. If you plan less than 20% down, compare PMI cost and cancellation timelines for conforming options.
- Line up liquidity. If you are buying before selling, discuss bridge financing or a HELOC and how it impacts your long‑term loan amount.
- Set your search targets. Use the math to define a conforming ceiling and a jumbo range so you can act quickly with confidence.
When you are clear on your financing lane, you can focus on the right Studio City homes and write stronger offers. If you want a local, calm, and methodical guide to help you line up financing and strategy before you shop, connect with Angela Waters to talk through your plan.
FAQs
What is the 2024 conforming loan limit in Los Angeles County?
- For 1‑unit properties in 2024, the conforming loan limit is $1,149,825.
Does the conforming limit apply to condos the same as single‑family homes?
- Yes. Limits are based on unit count, so a 1‑unit condo and a 1‑unit single‑family share the same cap.
If my purchase price is below the limit but my loan amount is not, which determines jumbo vs. conforming?
- The loan amount controls the classification. Down payment size is what determines whether you are under or over the limit.
Do jumbo loans always have higher rates than conforming loans?
- Not always. Jumbos have sometimes priced higher, but the spread changes with market conditions and lender appetite.
What down payment is typical for jumbo loans in Studio City?
- Many lenders look for 10% to 20% down on jumbos, though requirements vary by lender and borrower profile.
Do FHA or VA loans follow the same FHFA conforming limits?
- No. FHA and VA have different rules and county limits. Check each program’s guidelines for specifics.
