Jumbo Loans
A non-conforming loan that allows a borrower to purchase or refinance a high value property is considered a jumbo home loan. For most areas of the country the current conforming loan limit, set by government enterprises, is $715,000. If you have a low debt-to-income (DTI) ratio, a higher credit score, and healthy reserves, a non-conforming jumbo loan may be right for your high-value, luxury home.
If you’re considering a jumbo mortgage, keep in mind that the down payment requirement is 10.01%, and you may have a higher rate and stricter underwriting guidelines. Contact a licensed loan officer to learn more.
Eliminates the need for secondary financing
Allows buyers to finance more expensive properties in counties with lower conforming loan limits
No prepayment penalties
Flexible term options could enable you to save money without extending the length of your loan
Loan amounts up to $3 million, with 12 months reserves
No prepayment penalties
Get up to $500,000
Manage your debts at the best possible rate
Consolidate other debt from multiple sources, like auto loans and credit cards, into a single payment to simplify your finances
Who Is Eligible for a Jumbo Loan?
Unlike conventional loan products, jumbo loans have more stringent standards: a lower debt-to-income (DTI) ratio, a higher credit score, and healthy reserves.
Jumbo loans allow a borrower to secure a loan that exceeds the current conforming loan limit, which is $715,000 in most areas of the country. When considering a jumbo loan, keep in mind that a minimum down payment of 10.01% is required, the rate structure may vary and you may be subject to stricter underwriting guidelines. South Main knows jumbo loans and can guide you through the process to find your best option.
Jumbo mortgage eligibility requirements include:
Great credit – Generally credit scores of 700 or higher depending on the transaction, though the FICO requirement may vary from lender to lender.
Minimum 10.01% down payment – A 10.01% minimum down payment is required to secure a jumbo loan up to $3 million.
Reserves – Specific reserves are needed: 9 months reserves for up to $1.5 million and 12 months for single family homes in the top tier from $1.5 – 3 million.
Proof of income – Proof of steady income to cover the cost of your loan is needed and self-employed individuals will need to supply two years of tax returns.
Debt-to-income – Your debt-to-income (DTI) ratio should be no more than 43%. This is the percentage of your monthly gross income that is paid out to recurring debts.
Why Choose South Main as Your Jumbo Mortgage Broker?
South Main focuses on offering the right loan based on individual needs. From first-time homebuyers to those refinancing their existing loan, our team is equipped to help borrowers through each and every step of the jumbo mortgage process.
We is committed to making the loan experience easy for each and every customer, even those who are interested in high-value, luxury homes and want to keep it simple by using a jumbo home loan. We’ll find the right home loan for your unique needs and we offer competitive rates on a wide range of products.
What Are the Credit and Income Requirements for a Jumbo Loan?
Jumbo loans require a credit score of 700 or higher. Although there are many other factors, including credit history, the jumbo loan process for borrowers is very similar to that of a conventional loan. The documentation needed is comparable, but with slightly stricter requirements for most situations.
What Kind of Properties Can I Buy with a Jumbo Mortgage?
Jumbo home loans can be used for a wide range of luxury properties:
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- Single family homes (attached/detached homes)
- Planned Unit Developments (attached/detached homes within a homeowner’s association)
- Condominiums
- 2-unit primary residence
- 1-unit second or vacation home (non-rental, no investment)
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Can I Use Gifted Funds for My Down Payment?
You may use cash gifts towards the costs of a jumbo loan, however, at least 5% of the down payment must come from your own funds. The minimum amount required to come from your own sources may vary depending on the specifics of your purchase loan.