The Insider’s Guide to Getting the Lowest Mortgage Rate & Payment in San Diego
Getting the lowest possible mortgage rate and monthly payment isn’t about luck — it’s about using the right loan program for your situation and the exact property you’re buying.
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Most buyers think the only choice is “conventional vs. FHA.” That is rarely true. There are multiple special and insider programs available in San Diego that can save you thousands of dollars per year in payments — if you match the right program to the right buyer and property.
1. Condo vs. House: The Property Type Changes the Loan
Condo lending rules are different from those for houses. Some lenders restrict condo financing, while others specialize in it. Depending on the building and your profile, this could change your rate and approval.
- Credit union portfolio loans can be more flexible on condos and offer competitive rates.
- Non-QM loans can help when the condo is not FHA/VA approved.
- Conventional loans with 3%–5% down if the complex qualifies.
- FHA loans with 3.5% down when the building is approved.
This is why two buyers with the same credit score can see different rates: the property type matters.
2. If You Have 20%+ Down, the Strategy Changes
If you have 20% or more for a down payment, you may qualify for options designed to reduce your long-term cost, not just your rate.
- No-mortgage-insurance (No-MI) loans
- Discounted rate buydowns where the seller or lender helps reduce the rate
- Portfolio loans with flexible terms and closing cost credits
In some cases, it can make more sense to put less money down and use lender or seller funds to buy down your rate and payment. The math often surprises people.
3. 3%–5% Down: Silent Seconds and Assistance Programs
For buyers with lower down payments, there are targeted programs designed to make ownership more affordable, especially in certain census tracts and moderate-income areas. Some even have no income cap, depending on the location.
- Silent seconds (no monthly payment, often low or zero interest)
- Down-payment assistance and closing cost help
- Lender credits are tied to slightly higher rates but lower cash to close
- Special census tract programs that reduce or remove income caps
These can be the difference between waiting years to buy versus getting in now with a manageable payment.
4. FHA and VA Loans: Built-In Rate Advantages
FHA and VA loans often carry lower rates than conventional loans, especially if your credit score is not perfect.
- FHA allows lower credit scores and smaller down payments.
- VA (for eligible active duty, reserves, and veterans) is usually one of the best total-cost options available.
- Both allow seller credits that can be used for interest rate buydowns and closing costs.
If you are eligible for a VA loan and you are not looking at it, you may be leaving thousands of dollars of annual savings on the table.
5. DCR Loans for Income Properties
If you are buying an income property (a duplex, triplex, fourplex, or even a single-family rental), a Debt-Coverage-Ratio (DCR) loan may be your best option.
- Approval is based more on the property’s rental income than your personal income.
- It can make qualification easier when traditional income documentation is tight.
- Lets you leverage rental income to help offset your total payment.
This is a different way to think about your payment: focus on net cost after rent, not just the gross mortgage amount.
6. The Hidden Gem: Assumable Loans at 2%–3%
Many San Diego homes still have existing FHA or VA loans from the low-rate years at 2%–3%. With the proper structure, you can assume that loan instead of getting an entirely new one.
- Step into an ultra-low fixed interest rate.
- Potentially lower closing costs.
- Lower monthly payment than almost any new loan available today.
The challenge is that these opportunities are not always listed in the public remarks. You need someone actively looking for them.
To start seeing these opportunities, you can: Find an Unlisted and Off-Market San Diego Home here.
What Determines Your Lowest Rate and Payment?
Your best option depends on:
- Your down payment (3%, 5%, 10%, 20% or more)
- Credit score and debt level
- Whether you are buying a condo, house, or income property
- Eligibility for VA or special census tract programs
- Whether the home has an existing assumable FHA or VA loan
- If down-payment or closing-cost assistance makes sense
The biggest mistake buyers make is trying to figure this all out on their own or relying on a one-size-fits-all loan quote.
Want to See Which Program Gives You the Lowest Payment?
If you want a custom plan for the lowest rate and payment you can realistically get, let’s talk.
Call or text George Lorimer at 619-846-1244 for a quick strategy session.
You can also check your numbers and equity here: Get Your San Diego Home Value & Custom Payment Plan.
And if you want access to properties regular buyers never see, including homes with assumable 2%–3% loans: Find an Unlisted and Off-Market San Diego Home.
There is no cost or obligation to talk. The goal is simple: structure your purchase so you pay as little as possible to own a San Diego home.