Jumbo Loans

Jumbo Loans:


Jumbo Loans exceed the maximum loan amounts established by Fannie Mae and Freddie Mac conventional loan limits.


Rates on jumbo loans are typically higher than conforming loans.


Jumbo Loans are typically used to buy more expensive homes and high-end custom construction homes, and usually require a higher down payment than traditional loans. Borrowers will expect to provide a downpayment of at least 10 – 20 percent for a purchase (or have at least 20 percent equity in a refinance).


Jumbo mortgage loans are considered higher risk for lenders, mainly because of their large size. Jumbo loans are often associated with larger, luxury properties. If the borrower defaults on a jumbo mortgage loan, it could be harder to quickly sell a luxury residence for its full price. These homes can be more subjective and not as easily sold to a mainstream borrower. In some cases, luxury prices can also be more susceptible  to market highs and lows. That is one of the reasons that lenders request a higher down payment from jumbo loan seekers. Lenders may require two appraisals on a jumbo mortgage loan.


Borrowers are also required to


  • Document their income. Borrowers will to provide recent paystubs and two years of tax returns.

  • Show proof of income from all sources and proof of liquid assets.

  • Show a minimum credit score of 680 is required, although some lenders may require even higher credit scores than  680.

  • To make sure that the monthly mortgage payment to be no more than 43 percent of pre-tax income


Be aware that although most banks have similar lending requirements for jumbo loans, there are some variations.


There are lenders who have different requirements if the borrower owns a condominiums rather than a single family home. Certain lenders will not work with short sales or foreclosed homes. And some lenders will only approve jumbo loans only for primary residences, while others will will do jumbo loans for vacation homes and investment properties. That's why it's necessary to shop around.


Thinking of Purchasing a Home?

You can start the process by visiting our Purchase Assistant or by testing out different financial scenarios on one of our online calculators.

Considering a Refinance?

There are many ways to go when you refinance your home. Start by narrowing down your options based on your individual needs on our Refinance Advisor page.


Ready to start the home mortgage process today?

Complete a  secure online loan application or call me for a friendly chat and free mortgage consultation today at 707-763-6290


Questions about your California mortgage loan?

Or your California mortgage rates? We always strive to bring you the lowest mortgage rates in California. We always strive to bring you the lowest mortgage rates in California. Feel free to call us at (707) 763-6290, Click here to submit a question through our website or email to js@emortgages.com