Best Mortgage Lenders in Los Angeles, CA

In Los Angeles, median sale prices have been on the uptick since 2012, and most projections show them increasing in the future, too.

Current mortgage rates in California change frequently, so it’s best to check them using this tool from the Consumer Finance Protection Bureau. Although interest rates are usually lower in Los Angeles than the national average, the price of housing in Los Angeles is significantly higher. There are many more expenses that go into homeownership than just the mortgage rate and down payments, so it’s important to find an affordable area and a mortgage that works best with your finances.

Many factors affect the final amount of your mortgage payment, so it’s useful to have a mortgage calculator so you know what you can afford.

The most common home loans in Los Angeles are 30-year fixed-rate mortgages, followed by adjustable-rate mortgages and 15-year fixed-rate loans. Since the values of homes in California are still trending upward, a 5-1 or 7-1 ARM may help you sell the home to make a quick profit. If you are planning on making your home a long-term investment, a 30-year, fixed-rate loan may be better.

We picked a few areas around Los Angeles to show how location affects your choice of mortgage:

• Long Beach: The area has a large population of upwardly mobile young people. Many Long Beach residents choose FHA loans because of the lenient requirements, and others take advantage of Long Beach’s comparatively low property values to get conventional, conforming mortgages.
• Thousand Oaks: The median home value in Thousand Oaks is $733,400, making housing costs here among the highest in the country. A non-conforming, jumbo loan is probably best for buyers here.
• Glendale: Single-family homes are the second most common type of house in Glendale, with most built after World War II. Considering many homes in Glendale are older houses, homeowners might find a home improvement loan to be a good option.

Federal mortgage requirements in Los Angeles

Conforming loans meet guidelines for how much the government is willing to insure your home loan. The federal maximum changes, and because housing is so expensive in Los Angeles County, the maximum is usually higher here.

If you require a loan that is higher than these limits (which is likely in LA), you can get a jumbo loan. Qualifications for jumbo loans are much stricter because of the higher risk to the loan provider. Maximum conforming loan limits generally won’t cover the cost of homes in the San Fernando Valley or Santa Monica, so consider a jumbo loan if you’re interested in one of those areas.

Many California lenders claim to have the fastest loan process and lowest mortgage rates, but it’s more important that you shop around to verify this yourself.

• Know your credit score and financial history before applying for loans, as this decreases the chance of surprises.
• Use a mortgage calculator to get a feel for what you can afford, then start the pre-approval process with a handful of lenders. It may feel overwhelming, but it gives you a fairly accurate picture of what you’ll pay.
• As you choose a lender in Los Angeles, keep any special needs in mind. Some companies specialize in helping borrowers with poor credit, while others focus on high-risk jumbo loans.
• Don’t forget to consider your down payment, either. If you know how much you’re preapproved for, calculate what 3%, 5% or 20% down is and see if you can afford that.
• Check the lender’s customer reviews. If you don’t see evidence of the type of service you expect, you might want to move on.

Once you decide on a mortgage company, you can begin the lending process in earnest. The Los Angeles housing market can seem expensive and out of reach, but doing your research and finding the right loan is the most important step to finding your dream home.