Jumbo Loans

Bigger might be better.

All About Jumbo Loans

If you’re in the market to buy a new home, especially a larger more luxurious property, or a vacation home on the water, you’ve probably heard about jumbo loans. Just like it sounds, a jumbo loan is larger than most other types of loans. And, because of that, they have different rules and more stringent guidelines. For example, for a jumbo loan, in most cases, you’ll need a credit score of at least 700. 

The loan originators at Total Lending Concepts are experts at closing jumbo loans and can walk you through the entire loan process. Because of their experience, they make it easy for you and provide a stress-free experience. Read on to discover more about jumbo mortgages.  

What is a Jumbo Loan?

As we mentioned above, a jumbo home loan is for larger loan sizes. When looking at this loan, it’s essential to understand how they compare to two other types of mortgages.

  1. Conventional – these meet Fannie Mae and Freddie Macs guidelines including loan limits
  2. Government – FHA, VA, USDA loans are backed by the government and have loan limits 

Jumbo mortgage loans exceed the loan limits for conventional and government loan programs. This lending limit is one of the most significant differences to look at when you compare a jumbo loan vs. conventional.

Jumbo Loan Limits

A jumbo loan is a mortgage that exceeds conforming loan amounts. In most areas, the 2019 conforming loan limit is $474,350 for a single-family home. So, if you want to purchase a home over that amount, you’ll need a jumbo mortgage. 

Every year the FHFA – Federal Housing Finance authority sets the conforming loan limits for Fannie Mae. There are general loan amounts and loan amounts for high-cost areas. The high-cost areas aren’t only for locations like NYC or San Francisco but also include states like:

  • Colorado
  • Missouri
  • Texas
  • Oklahoma
  • Florida

In a high-cost area, the conforming loan limit can increase to $726,525.

Loan Limits for Multi-Unit Properties

If you’re looking to purchase a multi-unit property here are their general limits:

  • 2 units: $620,200 (high cost areas $930,300)
  • 3 units: $749,650 (high cost areas $1,124,475)
  • 4 units:  $931,600 (high cost areas $1,397,400)

Jumbo Loans Interest Rates

Compared to the government or conventional loans, jumbo loan mortgage rates do have higher interest rates. But, the higher rate doesn’t mean you can’t get a payment within your budget. At Total Lending Concepts, we offer our clients several programs to choose from. A few of the most popular are:

  • Fixed Loans
  • Adjustable Loans
  • Interest Only Loans

Depending on how aggressive you want to be in paying down the principal, you can get a term from 10 to 30 years. Contact your loan officer to go over your options with you. They will find the best interest rate and program to fit your needs. 

Jumbo Loans Down Payment

Just as credit requirements are stricter, so are down payment requirements. 

A typical downpayment for a jumbo loan is 20%. But, there are programs that require less and some more. The amount that you’ll need to put down can vary depending on your credit score and amount of debt compared to income. 

The team at Total Lending is ready to help you fund your dream home. Ready to get started? Contact us today to see which jumbo loan program buyer program is right for you.