Mortgage Basics for 2026 Buyers

Mortgages are one of those subjects where the vocabulary is harder than the actual ideas. Let's keep this in plain English.

A fixed-rate mortgage locks your interest rate for the life of the loan. An adjustable-rate mortgage — an ARM — fixes it for an initial period, usually five, seven, or ten years, then adjusts annually based on an index. Fixed is the right answer for most buyers who plan to stay seven-plus years.

Conforming loans are at or below the local Fannie/Freddie limit; jumbo loans are above it. In San Diego County the conforming limit is generous enough that many of our buyers stay inside it. Jumbo isn't scary, but it does come with stricter income and reserve requirements.

Points are prepaid interest. One point equals one percent of the loan amount and typically lowers your rate by a quarter of a percent. The break-even is usually four to six years — meaning if you'll be in the home longer than that, points often pay off.

None of this replaces a conversation with a good local lender. The two or three lenders we recommend most often will sit with you for an hour, run the math both ways, and tell you the honest answer for your situation.