Palm Springs Mortgage | DiVita Home Finance
Palm Springs and the Coachella Valley represent one of California’s most distinctive real estate markets — a desert playground of mid-century modern architecture, resort communities, golf course estates, and some of the most unique property structures in the country. DiVita Home Finance specializes in Palm Springs mortgage financing, including the land lease programs that define a significant portion of this market and the vacation home, short-term rental, and investment financing that drives so much activity in the Desert Cities.
Michael DiVita and the DiVita Home Finance team do extensive business in the Coachella Valley and have deep familiarity with the financing nuances that trip up buyers working with out-of-area lenders — particularly land lease properties, HOA-intensive resort communities, and the STR/Airbnb investment market that is central to the desert economy.
The Land Lease: What Every Palm Springs Buyer Must Understand
Approximately 30% of properties in Palm Springs — and a significant portion in Cathedral City and parts of neighboring desert communities — sit on land leased from the Agua Caliente Band of Cahuilla Indians. This is not a defect or a risk to avoid; it is simply a structural feature of a significant portion of the Palm Springs market, and buyers who understand it can access excellent properties that others incorrectly dismiss.
How Agua Caliente Land Leases Work
When you purchase a home on leased land, you own the structure (the house, the improvements) but not the land beneath it. You pay a ground rent to the Agua Caliente Band of Cahuilla Indians for the right to use the land. The lease has a defined term — typically 65 years from the original date of the lease, with many existing leases having 20-40+ years remaining — and lease payments that are adjusted periodically.
The key financing question is how many years remain on the lease. Most conventional lenders require the lease to extend at least 10 years beyond the loan maturity date. For a 30-year mortgage, that means at minimum 40 years remaining. Many lenders require more. Leases with shorter remaining terms have a narrower pool of willing lenders, though portfolio and non-QM programs are often available.
Financing Land Lease Properties
Not all lenders will finance land lease properties in Palm Springs — which is one of the most important reasons to work with a broker who knows this market. DiVita Home Finance has lender relationships that specifically include Palm Springs land lease programs. Key considerations:
- Lease term remaining — The single most important variable; verify before writing an offer
- Lease assignment — The lease must be assignable to the buyer; confirm with the title company early
- Ground rent amount and escalation schedule — Factors into affordability and lender willingness
- VA and FHA on land leases — Both VA and FHA will finance Agua Caliente land lease properties under certain conditions; VA in particular has historically been active in this market
- Conventional lender requirements — Fannie Mae and Freddie Mac each have specific land lease approval criteria; not all properties qualify
- Portfolio options — For properties that don’t meet agency requirements, portfolio lenders often fill the gap
2026 Conforming Loan Limits — Riverside County
Palm Springs is in Riverside County. The 2026 conforming loan limit for Riverside County is $806,500 — the national baseline (not a high-cost area designation). Purchases above this amount require jumbo financing. While most Palm Springs properties are priced well below this threshold, luxury properties in Palm Desert, Rancho Mirage, Indian Wells, and La Quinta regularly exceed conforming limits.
Mortgage Programs for the Palm Springs Market
Conventional / Conforming Loans
For fee-simple properties (where you own both the home and the land) priced below $806,500, conventional financing provides the most competitive rates. Down payments from 3-20% depending on buyer profile. Available for primary, second home, and investment property use.
FHA Loans
FHA is available throughout the Coachella Valley with a $806,500 limit in Riverside County. With 3.5% down and flexible credit (580+), FHA is an excellent option for primary-residence buyers, including those purchasing on Agua Caliente land leases when lease terms meet FHA requirements.
VA Loans
VA loans are particularly powerful in the Palm Springs market. With no down payment, no PMI, and no loan limit for veterans with full entitlement, VA is available on both fee-simple and qualifying land lease properties. The Coachella Valley has a significant veteran community and VA is one of the most commonly used programs here.
Vacation Home / Second Home Loans
A large portion of Palm Springs real estate is purchased as a second home or vacation property — often by buyers from Los Angeles, the Bay Area, and out of state. Second home financing requires 10% down and documentation that the buyer does not intend to rent the property full-time as an investment. Rates are slightly higher than primary residence but significantly lower than investment property rates.
DSCR / Short-Term Rental Investment Loans
Palm Springs has one of the most active Airbnb and VRBO markets in California. DSCR (Debt Service Coverage Ratio) loans qualify investors based on projected or actual short-term rental income rather than personal income — no tax returns required. If the property generates enough rental revenue to cover its debt service (typically a ratio of 1.0-1.25x), you can qualify. This is ideal for buyers purchasing a Palm Springs home specifically for vacation rental income.
Jumbo Loans
For luxury properties in Rancho Mirage, Indian Wells, La Quinta’s exclusive guard-gated communities, and high-end Palm Desert above $806,500, jumbo financing is available with 10-20% down. Resort community properties with golf course or mountain views often qualify for favorable appraisal treatment.
Coachella Valley Cities We Serve
| City | Typical Price Range | Primary Loan Type | Key Notes |
|---|---|---|---|
| Palm Springs | $400K – $2M+ | Conventional / FHA / VA / DSCR | Land leases common; STR hotspot |
| Palm Desert | $500K – $2.5M | Conventional / Jumbo | El Paseo shopping, resort lifestyle |
| Rancho Mirage | $700K – $5M+ | Jumbo / Vacation Home | Celebrity estates, The Ritz-Carlton area |
| La Quinta | $600K – $3M | Conforming / Jumbo | PGA West, guard-gated communities |
| Indian Wells | $700K – $4M | Jumbo / Vacation Home | Exclusive golf communities, resort hotel area |
| Cathedral City | $350K – $800K | FHA / Conventional / VA | Most affordable Desert City; land leases present |
Short-Term Rental Regulations in Palm Springs
Palm Springs has a well-established short-term rental permitting program. STR permits are required for any rental under 28 days, and the city limits the number of STR permits available. If you are purchasing a property for Airbnb or vacation rental purposes, verify that the property has an active permit or that a permit is available — the STR permit status is a critical piece of due diligence that affects both financing and investment viability. We advise buyers on this early in the process.
Frequently Asked Questions
Can I get a regular mortgage on a land lease property in Palm Springs?
Yes — many lenders finance Agua Caliente land lease properties. The key variable is the remaining lease term. Most programs require at least 10 years beyond your loan term. VA and FHA both finance qualifying land lease properties. We check lease status before you write an offer so there are no financing surprises.
What is the conforming loan limit in Palm Springs / Riverside County?
The 2026 conforming limit for Riverside County is $806,500 — the national baseline. Palm Springs is not designated as a high-cost area by the FHFA. Purchases above $806,500 require a jumbo loan.
Can I use a DSCR loan to buy an Airbnb in Palm Springs?
Yes, DSCR loans are widely used for Palm Springs STR investment properties. Lenders typically use market rent estimates from a 1007 appraisal or third-party STR income platforms. The property must have an active or transferable STR permit, and the projected income must meet the lender’s coverage ratio requirement (usually 1.0-1.25x).
Do you finance vacation home purchases in Rancho Mirage or Indian Wells?
Yes. Second home financing is available throughout the Coachella Valley with 10% down. Luxury properties above the conforming limit require jumbo programs, which we access through multiple portfolio lenders familiar with the desert resort market.
Ready to Buy in Palm Springs or the Desert Cities?
Or call: 800-239-1103 — 7 days a week.
