Are you eyeing a Cupertino home and wondering if you’ll need a jumbo loan? You’re not alone. With prices commonly above standard limits, many buyers here finance with jumbos and face stricter documentation and appraisal rules. In this guide, you’ll learn what counts as a jumbo in Santa Clara County, how lenders evaluate jumbo borrowers, what to expect with appraisals, how rates work, and how to present a strong, finance-ready offer. Let’s dive in.
What makes a loan jumbo in Cupertino
A jumbo loan is any mortgage that exceeds your county’s conforming loan limit set by the Federal Housing Finance Agency. For 2024, Santa Clara County uses the high-cost area ceiling. That means a first mortgage above $1,149,825 for a single-family property is jumbo.
The basic math is simple: Purchase price minus down payment equals your loan amount. If your loan amount is greater than $1,149,825, you’re in jumbo territory.
Quick examples
- Example A: Home price $2,500,000; 20% down ($500,000) → loan $2,000,000 → jumbo.
- Example B: Condo price $1,050,000; 20% down ($210,000) → loan $840,000 → not jumbo.
- Example C: Home price $1,200,000; 10% down ($120,000) → loan $1,080,000 → not jumbo.
Note: FHFA limits differ by property type. Two- to four-unit properties have higher limits than single-family homes, and condo eligibility can depend on project review. Check the current FHFA table for your property type and location to confirm.
Jumbo underwriting basics
Jumbo loans come with tighter rules than many conforming programs. Requirements vary by lender, so plan to compare options.
Credit, down payment, DTI
- Credit score: Many lenders want strong credit, often 700 to 740 or higher, with the best pricing at 740 and above.
- Down payment: On primary residences, 20% down is common. You may see better pricing and approval odds with 25% to 30% down.
- Debt-to-income ratio: Typical maximums range from the mid-30s to low-40s. Some lenders allow higher with compensating factors such as strong reserves.
Reserves and assets
Lenders often require significant cash reserves measured in months of principal, interest, taxes, insurance, and HOA dues.
- Primary residences: Commonly 6 to 12 months of PITIA.
- Second homes or investment properties: Often 12 to 24 months or more.
Asset documentation usually includes recent bank, retirement, and brokerage statements. Large or recent deposits must be sourced and explained.
Income and gifts
- W-2 employees: Expect 2 years of tax returns, 2 years of W-2s, recent pay stubs, and a verification of employment.
- Self-employed or 1099: Expect 2 years personal and business tax returns, K-1s where applicable, and possibly a year-to-date profit and loss. Some programs accept business bank statements, but these are lender specific.
- Gifts: Some jumbo programs allow gift funds. You will likely need a gift letter and donor statements, and many lenders require you to contribute some of your own funds.
Cupertino appraisal realities
Cupertino’s high-value, often unique homes can be tough to appraise because of limited comparable sales, varied lot sizes, and upgrades that don’t always have direct comps nearby. Plan ahead so the valuation process supports your purchase.
What lenders expect
Many jumbo lenders require a full interior and exterior appraisal by a certified appraiser experienced with high-value Bay Area properties. Some may require a second appraisal or an appraisal review. Scheduling can take longer when local appraisers are busy.
How you can prepare
- Share relevant sales: Offer the appraiser a list of relevant nearby sales and notes on similarities.
- Document upgrades: Provide invoices, permits, and contractor records for renovations or additions.
- Consider adjacent markets: For unique features, highlight appropriate comparables from nearby areas like Sunnyvale, Saratoga, or Los Altos when they are relevant.
- Condos: Be ready for project review. Some condo projects may not meet certain program guidelines.
Appraisal contingencies
In a competitive offer, understand your appraisal contingency and options for an appraisal gap. If the appraised value comes in low, you may need to increase your down payment to keep the same loan terms. Discuss timing with your lender so your appraisal process aligns with the seller’s expectations.
Jumbo rate dynamics
Jumbo rates are priced by lenders based on investor demand, hedge costs, and long-term Treasury yields. They do not follow the same pricing engine as conforming loans tied to GSEs. Depending on market conditions and your profile, jumbo rates can be slightly higher or lower than conforming.
Rate locks and points
Rates can move quickly. Get quotes from multiple lenders on the same day, ask about lock periods, and check if a float-down option is available. If you are considering points or a temporary buydown, weigh the upfront cost against your expected time in the home and likely refinance paths.
Strengthen your offer with jumbo financing
A well-prepared jumbo file can give sellers confidence that you will close on time.
Pre-qualification vs pre-approval
- Pre-qualification: A quick estimate based on unverified information. Not ideal for competitive Cupertino offers.
- Pre-approval: Your lender reviews documents and issues a conditional approval. Stronger than pre-qualification.
- Fully underwritten pre-approval: Underwriting reviews your income, assets, and credit in advance and issues an underwritten approval. This is often the strongest position for a jumbo offer.
Practical steps sellers notice
- Secure a fully underwritten pre-approval and ask your lender to highlight reserves and verified assets in the letter when appropriate.
- Provide proof of funds for down payment and reserves.
- Right-size your appraisal contingency or show a plan to cover a potential gap.
- Consider a larger earnest money deposit while balancing your protections.
- Work with local jumbo specialists who understand Cupertino appraisals and timelines.
- Ask your lender to confirm a realistic closing timeline in writing.
- If available, note access to bridge funds or a HELOC to strengthen flexibility.
Lender questions checklist
Use these questions to compare lenders and programs side by side:
- Is my loan conforming or jumbo for this price and down payment? Please show the math.
- What is the maximum loan amount and maximum LTV for primary, second home, and investment?
- What credit score range earns best pricing? Is there a minimum?
- Exactly what documentation will you require for income and assets?
- How many months of reserves are required, and how do you count retirement assets?
- Do you allow gift funds? What documentation and minimum borrower contribution are required?
- What appraisal type and timeline do you require? Do you ever require two appraisals?
- How do your jumbo rates compare to conforming today? How long can I lock, and is there a float-down?
- What are my estimated closing costs and lender fees?
- Do you offer portfolio or bank-statement jumbo options for self-employed borrowers?
- How long is your typical underwriting and closing timeline for a jumbo here?
- Do you service the loan or sell it to an investor?
- What are my options and costs for a rate buydown?
Cupertino buyer document checklist
Have these items ready early to speed up underwriting and strengthen your offer:
- Identification and recent credit report authorization.
- 2 years of personal tax returns; W-2s and recent pay stubs for W-2 borrowers.
- For self-employed: 2 years personal and business tax returns, K-1s where applicable, and a year-to-date profit and loss.
- 60 to 90 days of bank and brokerage statements to verify funds and reserves; retirement statements if using those assets.
- Documentation for large deposits and transfers, including asset seasoning details.
- Gift letter and donor statements if using gift funds.
- Property-related records for appraisal: permits, renovation invoices, upgrade lists, and recent comparable sales you or your agent have identified.
- For condos: HOA documents and any information needed for project review.
Timing and next steps
Start lender conversations before you start touring. Get a fully underwritten pre-approval if possible and confirm how many days your lender needs for appraisal and closing. In Cupertino, choosing an experienced jumbo lender and appraiser can prevent delays and help your offer stand out.
Plan to compare at least two or three lenders. Ask for written quotes on the same day, with the same assumptions for points, lock period, loan amount, and property type. Review the reserve requirement, closing cost estimate, and appraisal timeline side by side so you can choose the best overall fit, not just the lowest headline rate.
Ready to build a winning jumbo strategy for your Cupertino purchase? Connect with Edelino Chen for a clear plan, bilingual guidance, and local expertise tailored to your goals.
FAQs
What is the 2024 jumbo trigger in Santa Clara County?
- Any first mortgage over $1,149,825 for a single-family property is considered jumbo in Santa Clara County.
How do I know if my loan will be jumbo in Cupertino?
- Subtract your down payment from the purchase price; if the result is more than $1,149,825 for a single-family home, you’ll need jumbo financing.
Do jumbo loans require bigger reserves than conforming?
- Yes. Many lenders require 6 to 12 months of PITIA for primary residences and 12 to 24 months for second homes or investments, depending on your profile.
Are jumbo mortgage rates always higher than conforming rates?
- Not always. Depending on market conditions and lender pricing, jumbo rates can be slightly higher or lower than conforming on any given day.
What makes a strong jumbo offer to a seller in Cupertino?
- A fully underwritten pre-approval, proof of funds and reserves, a realistic appraisal plan, and a lender-confirmed closing timeline signal a high-confidence close.
What appraisal challenges are common with Cupertino homes?
- Limited comparable sales, unique floor plans, and high-value upgrades can complicate valuations, so detailed documentation and experienced appraisers are key.
