The base conforming loan limit is up to $417K. This is where the best rate will be found. There is also a temporary "Jumbo Conforming" limit based on one's County. For Alameda, this is up to $729,750 for a single-family home. You can check other Counties and limits for 2, 3, and 4 unit properties here:
There are a number of reasons for the difference between conforming and jumbo conforming rates:
1) The government is only guaranteeing the base conforming loan limits, so investors of mortgage-backed securities (MBS) are focusing their dollars there.
2) The FED purchases of MBS is focusing on the base conforming levels.
3) With weak demand by investors for non-guaranteed Jumbo MBS interest rates must be higher to attract investors.
See the following two links if you really want to understand how mortgage rates are determined:
If you truly are serious about buying your first step should be a loan pre-approval to confirm what you can actually afford before placing an offer. You can read more about the loan pre-approval process here: http://www.Steven-Anthony.com/default.aspx?pp=39377
Of particular interest is the FHA program:
1) 3.5% minimum Downpayment.
2) Up to a 6% Seller Credit allowed for buyer's closing costs and Seller concessions (non-FHA max is 3%).
3) FHA requires that identified safety/health issues be corrected.
4) FHA allows up to $8,000 in financed energy efficient upgrades without negatively affecting borrower's debt-to-income ratio.
5) Cash reserves not required.
6) Upfront Mortgage Insurance may be financed.
7) Non-occupying co-borrowers are allowed.
8) High and flexible qualifying ratios.
9) FHA loans are assumable.
10) No pre-payment penalties.
11) Will consider "compensating factors" in determining whether a loan should be granted.
This chart provides information on the First Time Home Buyer Federal tax credit:
I would be happy to set you up with an automated MLS search agent for properties that meet your search criteria. Results would be automatically emailed to you. Contact me if you are interested.