Thinking of buying a home in San Francisco? Then you already know what you're up against. The San Francisco housing market is one of the most challenging in the nation, with some of the country's highest home prices, bidding wars on available homes and listings that seem to slip away before you can even see the property, let alone make an offer.
Fortunately, San Francisco home loans aren't much different from what you'll find elsewhere, except for the size of the loans. Because real estate prices are so high there, home loans in San Francisco can go as high as $679,650 (2018 limit) with all the most common mortgage types – conforming loans (Fannie Mae/Freddie Mac), FHA loans or a no-down payment VA loan. That's the highest allowed anywhere in the contiguous 48 states.
Jumbo loan limit – San Francisco
Anything above that figure is considered a jumbo loan, which has stricter lending standards than loans below the jumbo loan limit. Jumbo loan rates in San Francisco and elsewhere typically run somewhat higher than for conforming, FHA or VA loans.
Because home prices are so high, one strategy for getting the best mortgage rates in San Francisco is to use two mortgages to buy a home exceeding the jumbo loan limit. In this approach, you take out a primary mortgage for $679,650, then a second "piggyback" loan to cover the difference, along with any down payment you are making.
Because piggyback loans also charge higher mortgage rates than conforming loans do, this strategy only works if the difference between conforming and jumbo rates is great enough to justify using a second loan.
Mortgage refinance – San Francisco
It's very common for homeowners to refinance their mortgage from one time or another. Often, it's because the refinance rates available to them are better than the current mortgage rate they have on their home. Or they may be looking to shorten the loan term to pay the home off more quickly, change the type of loan they have (such as from an adjustable-rate to a fixed-rate mortgage) or borrow against their home equity through a cash-out refinance.
San Francisco refinance rates, like those elsewhere, are going to be pretty much identical to what they would be if you used the loan to purchase a home rather than refinance an existing mortgage. From the lender's perspective, there's not much difference between a refinance and a home purchase, so the rates are the same – though the actual refinance rate San Francisco borrowers receive will vary depending on the particulars of the loan.
Different customers will be offered different refinance rates based on their credit score, amount of home equity, size of the loan, loan type, whether they buy discount points and other factors. The refinance rate you pay will also depend on the underlying market rate, which varies from day to day and sometimes hour to hour – which is why borrowers seek to lock in a rate when they apply to refinance.
San Francisco refinance rates will also vary from lender to lender, so it's important to shop around to find the best rate you can qualify for. This means getting rate quotes from at least three lenders based on your credit profile and some general information about the loan you are seeking. An easy way to do that is by using the form at the top of this page, by which you can request personalized refinance rate quotes from up to three lenders by completing a single form.