San Diego mortgage rates are pretty typical for the western U.S., but home prices there are among the highest in the country. So when seeking a San Diego home loan, it pays to shop around carefully, as small differences in interest rates can make a big difference in what you pay over the life of the loan.
Mortgage rates in San Diego and elsewhere are tailored to the individual borrower and will vary according to the borrower's credit score, down payment and loan amount, among other factors. FHA mortgage rates are less dependent on credit scores than conventional loans are, and so can be an attractive option for borrowers with lower credit scores.
To get the best San Diego mortgage rates, compare loan offers from at least three lenders that are personalized for you. Lenders vary in how their structure home loans, with some charging more or less for different types of customers, so you want to find one that's a good match for you.
Jumbo loan limits – San Diego
Borrowers seeking home loans in San Diego benefit from the fact that the area is classified a high-value area for purposes of getting a mortgage. That means you can borrow more than the usual limits with a conventional or FHA loan, and avoid having to pay the higher rates usually associated with jumbo loans.
You can borrow up to $649,750 (2018 limit) with a Fannie Mae, Freddie Mac or FHA loan in San Diego. By contrast, the limits in most parts of the nation are $453,100 for a Fannie/Freddie mortgage, and $294,515 for FHA loans. That means you can borrow a lot more for San Diego home loans without having to get a jumbo loan, which typically carries a higher mortgage rate.
Most mortgages in the United States are backed by Fannie Mae, Freddie Mac or the FHA, regardless of the lender who makes the loan. Fannie and Freddie mortgages are often called conforming loans, because those mortgages must conform to Fannie/Freddie guidelines in order to be approved.
VA home loans in San Diego
Because of all the military personnel stationed there, VA home loans in San Diego are in high demand. VA mortgage rates are comparable to those on other types of home loans and often require no down payment, making them an attractive option for qualifying military personnel and veterans.
The San Diego VA loan limit (2018) is $649,750, the same as for conforming and FHA loans. However, it has a different meaning than the limits on those other loans. The VA loan limit is the maximum you can borrow with no down payment using the VA loan guaranty. However, you can get a VA jumbo loan in excess of that limit by making a down payment equal to 25 percent of the amount exceeding the San Diego VA loan limit.
While most VA borrowers make no down payment, it's worth noting that a down payment can reduce the funding fee paid on VA loans.