A Jumbo Loan or Jumbo Mortgage is a loan that may have high credit quality, but is in an amount above conventional conforming loan limits. This standard is set by the two government-sponsored enterprises, Fannie Mae and Freddie Mac, and sets the limit on the maximum value of any individual mortgage they will purchase from a lender.
Jumbo loans are mortgages specifically designed for high-value properties. Conventional loans top out between $510,400 and $765,600 depending on the county. If you need a mortgage for something more expensive than the conventional loans in your area can cover, you need a jumbo loan.
– You’re shopping for higher-priced properties.
– You have good credit, consistent income and little debt.
– You’re a high-income earner with additional assets.
– You’re looking to buy an investment property.
You need a credit score of at least 600 to qualify for a jumbo loan. Debt-to-income ratio requirements vary depending on home value, but in many cases your DTI needs to be below 38% to qualify for a jumbo loan.
You’ll also need proof of a strong financial history. This means when you apply, you’ll need copies of your bank statements and investment accounts. You’ll also need to provide your full tax return from the most recent year and other income and tax documents like your 1099s and W2s.
Having a large amount of cash available may also improve your chances of qualifying for a jumbo loan.
Mortgages have a limit on the max amount you can borrow for a given property. For conventional loans, also called conforming loans, that limit maxes out at a little over $500,000 in most areas. Jumbo loans have much higher limits and are designed for high-value properties.
Jumbo loans generally have more strict qualification requirements than conforming loans, but lenders do have some flexibility.
The limit on a jumbo loan is as high as three million dollars!
Interest rates for jumbo loans are competitive with the rates for conventional loans. Your interest rate will vary based on your financial situation, the area in which you’re buying, the property being purchased and the specific loan program.
Some lenders will bump up the interest rate a few points to accommodate the greater risk of the larger loan.
You can use a jumbo loan to purchase a variety of property types, including a vacation home, investment property or primary residence.
For more specific answers to your personal questions, talk to one of our Loan Originators.
30-Year Fixed – Blue
* 660+ FICO
* Up to 49.99% DTI and up to 80% CLTV
* DU only
* Loan amounts starting at $400,00 up to $3M
* Eligible on primary, second and investment property purchases, rate/term and cash-out refinances
For Purchase and Rate/Term Refinances
* For primary purchase loan amounts up to $3M – 6-12 months’ reserves required
* For second home purchase loan amounts up to $3M – 9-12 months’ reserves required
* For investment home purchase loan amounts up to $1.5M – 12 months’ reserves required
For Cash-Out Refinances
* For primary cash-out loan amounts up to $2M – 6-12 months’ reserves required
* For second home cash-out loan amounts up to $2M – 9-12 months’ reserves required
* For investment home cash-out loan amounts up to $1.5M – 12 months’ reserves required
* Two separate appraisals from two different appraisers required for loan amounts over $1.5M
* Temporary Rate Buydowns eligible on primary and second home purchases
30-Year Fixed – Green
* 680+ FICO
* Up to 45% DTI and up to 80% CLTV
* Loan amounts starting $1 over the conforming loan limits up to $2.5M
* Eligible on primary and second home purchases, rate/term and cash-out refinances
For Purchase and Rate/Term Refinances
* For primary purchase loan amounts up to $2M – 6-9 months’ reserves required
* For primary purchase loan amounts over $2M – 24 months’ reserves required
* For second home purchase loan amounts up to $2M – 6-9 months’ reserves required
For Cash-Out Refinances
* For primary cash-out loan amounts up to $2M – 6-9 months reserves required
* For second home cash-out loan amounts up to $1M – 6 months reserves required
* Two separate appraisals from two different appraisers required for loan amounts over $2M
* Temporary Rate Buydowns not permitted
30-Year Fixed – Pink
* 680+ FICO
* Up to 45% DTI and up to 89.99% LTV
* Loan amounts starting $1 over the conforming loan limits up to $3M
* Eligible on primary, second and investment property purchases, rate/term and cash-out refinances
* Loan amounts up to $2M reserves determined by DU/LPA findings
* Loan amounts over $2M — require 6 months in reserves in addition to any reserves required by AUS
* Two separate appraisals from two different appraisers required for loans over $2M
* Temporary Rate Buydowns eligible on primary and second home purchases
30-Year Fixed – Yellow
* 680+ FICO
* Up to 50% DTI and up to 90% LTV
* Loan amounts starting at $400,000 up to $3.5M
* Loan amounts up to $2M — reserves determined by DU/LPA findings
* Loan amounts between $2M – $3M — require 6 months in reserves in addition to any reserves required by AUS
* Loan amounts over $3M — require 12 months reserves in addition to any reserves required by AUS
* Eligible on primary, second and investment property purchases, rate/term and cash-out refinances
* Two separate appraisals from two different appraisers required for loan amounts over $2M
* Temporary Rate Buydowns eligible on primary and second home purchases
15-Year Fixed – White
* 700+ FICO
* Up to 45% DTI and up to 80% LTV
* Loan amounts starting at $600,000 up to $3M
* Reserves determined by DU/LPA findings
* Eligible on primary home purchases, rate/term and cash-out refinances
* Temporary Rate Buydowns not permitted
30-Year Fixed – Purple
* 700+ FICO
* Up to 43% DTI and up to 80% CLTV
* DU only
* Loan amounts starting $1 over the greater of the conforming loan limit or High Agency Cost limit up to $3M
* Eligible on primary and second home purchases, rate/term and cash-out refinances
For Purchase and Rate/Term Refinances
* For primary purchase loan amounts up to $3M – 9-18 months’ reserves required
* For second home purchase loan amounts up to $2.5M – 12 months’ reserves required
For Cash-Out Refinances
* Minimum 12 months’ reserves required (max cash out $300,000 or $500,000 with 10% CLTV reduction)
* Two separate appraisals from two different appraisers required for loan amounts over $2M
* Temporary Rate Buydowns not permitted