Conventional Mortgages in San Jose, CA

What Is a Conventional Mortgage?

A conventional mortgage is a home loan that is not insured or guaranteed by a federal agency such as the FHA, VA, or USDA. Instead, conventional loans follow underwriting guidelines set by Fannie Mae and Freddie Mac — the two government-sponsored enterprises (GSEs) that purchase and securitize most residential mortgages in the United States. Because there is no government insurance backing the loan, conventional borrowers typically need stronger credit profiles and larger down payments compared to government-backed alternatives. However, this tradeoff comes with significant benefits: lower total borrowing costs over the life of the loan, no upfront mortgage insurance premium, and the ability to cancel private mortgage insurance (PMI) once you reach 20% equity. Conventional loans account for approximately 75% of all mortgage originations in the U.S., making them the most commonly used mortgage product.

Conventional vs. FHA vs. VA: Which Loan Is Right for You?

• •Conventional loans require a minimum 620 FICO score and 3% down; FHA requires 580 FICO and 3.5% down; VA requires no down payment but is limited to eligible veterans and active-duty service members.
• •Conventional PMI cancels at 80% LTV. FHA mortgage insurance premium (MIP) lasts the entire life of the loan for borrowers who put less than 10% down — this can cost tens of thousands of dollars more over a 30-year term.
• •Conventional loans have no upfront mortgage insurance premium. FHA charges a 1.75% upfront MIP added to the loan balance at closing.
• •VA loans have no PMI but charge a funding fee of 1.25%-3.3% depending on service history and down payment.
• •For borrowers with 720+ credit scores, conventional loans almost always offer lower total costs than FHA — even with a smaller down payment.
• •CMRE loan officers analyze your complete profile and recommend the program with the lowest total cost, not just the lowest monthly payment.

CMRE 1-Year Tax Return Conventional (Freddie Mac)

CMRE offers a specialty 1-Year Tax Return conventional program through Freddie Mac for self-employed borrowers, freelancers, and small business owners. Traditional conventional loans require two years of tax returns to verify income — but many self-employed earners show increasing income and only need one year to prove qualification. This Freddie Mac program accepts a single year of personal and/or business tax returns, combined with a year-to-date profit and loss statement prepared by a CPA. Eligible borrowers need a minimum 660 FICO score, 10% down payment, and the property must be a primary residence or second home. This program is a powerful alternative for self-employed borrowers who don't qualify for traditional documentation but want to avoid Non-QM pricing.

Cross-Collateral Conventional Loans

CMRE's cross-collateral conventional mortgage program lets you pledge equity from properties you already own to reduce or eliminate the down payment needed for a new purchase. For example, if you own a rental property with $150,000 in equity, you can use a portion of that equity as collateral for a new conventional loan — potentially purchasing with zero out-of-pocket down payment. This strategy is particularly valuable for real estate investors building a portfolio and for borrowers who have significant equity but limited liquid cash. Cross-collateral loans require a combined LTV assessment across all pledged properties and are available for primary residences, second homes, and investment properties through CMRE.

2026 Conventional Loan Limits

• •The 2026 conforming loan limit for single-family homes in most counties is $806,500 — a FHFA-mandated ceiling that adjusts annually based on home price appreciation.
• •High-cost areas like Los Angeles County, San Francisco, and New York have a higher ceiling of $1,209,750 for single-family homes.
• •Multi-unit properties have higher limits: $1,032,650 (2 units), $1,248,150 (3 units), and $1,550,575 (4 units) in standard areas.
• •Loans above the conforming limit are classified as jumbo loans and require different underwriting — CMRE offers jumbo programs starting at 680 FICO with 10% down.
• •CMRE processes conventional loans up to $3,000,000 including conforming, high-balance conforming, and jumbo tiers.

How to Apply for a Conventional Mortgage with CMRE

• •Step 1: Pre-qualification — Submit a quick online application or call CMRE to discuss your goals. We pull credit softly and provide an initial rate estimate within minutes.
• •Step 2: Pre-approval — Provide income, asset, and employment documentation. CMRE issues a full pre-approval letter within 24 hours, making your offer stand out to sellers.
• •Step 3: Home search and offer — Work with your real estate agent to find the right property. CMRE coordinates with your agent to expedite the process.
• •Step 4: Processing and underwriting — CMRE orders the appraisal, verifies all documentation, and submits to underwriting. Average processing time: 14-21 days.
• •Step 5: Clear to close — Once all conditions are satisfied, CMRE issues the clear-to-close and schedules your closing date.
• •Step 6: Closing — Sign your loan documents, fund the loan, and receive your keys. CMRE handles escrow coordination and title review.