Frequently Asked Questions
FAQ's: Jumbo Loans
Q: What is the definition of a jumbo mortgage loan?
Q: Why would I need a jumbo mortgage loan?
Q: What is a super jumbo mortgage?
Q: Are interest-only jumbo mortgage rates available?
Q: What kind of credit score do I need to qualify for a jumbo mortgage?
Q: I am self employed - am I eligible for a jumbo mortgage?
Q: Do jumbo loans usually require a down payment?
Q: How much money can I be approved for with a jumbo mortgage?
Q: Can you refinance a jumbo loan?
Q: I want to Refinance from a Jumbo loan to a Conforming loan amount?
Q: Should I refinance a 5/1 Interest Only ARM at 5.5% which resets in 1.5 to 2 yrs?
Q: Can I a get a loan for a second home or vacation home using a jumbo mortgage program?
Q: Are there any stated income jumbo loans and if so, at what rate/cost?
What is the definition of a jumbo mortgage loan?
Answer: It's as simple as it sounds. It is called a jumbo mortgage because it is larger than other "traditional" conventional home loans of $424,100 or less. If you're looking to purchase a more expensive home, this type of loan may be exactly what you need.
Why would I need a jumbo mortgage loan?
Answer: If you are seeking a loan amount that exceeds $424,100, then you need a jumbo mortgage loan. Fannie Mae and Freddie Mac determine loan "maximums," every year so any loan that is above their maximum loan limits are considered a jumbo loan.
What is a super jumbo mortgage?
Answer: Like a jumbo loan, a super jumbo mortgage is a non-conforming loan amount usually $1,000,000 and above.
Can I get an interest-only rate with a jumbo mortgage?
Answer: Yes! You can choose to pay an interest-only fixed-rate for a period of 3, 5 or 10 years. Contact one of a jumbo lender to find out more about an "interest only" jumbo loan.
What kind of credit score do I need to qualify for a jumbo mortgage?
Answer: Currently, a minimum credit score of 650 is required for a full documentation conventional loan. The credit scores are lower for a FHA or VA jumbo loan.
I am self employed - am I eligible for a jumbo mortgage?
Answer: Yes! Being self-employed or W2'd does not hurt you as long as you can document your income. If not, due to large tax write-offs on your 1040s, then see if you can qualify under the alternative income documentation program.
How much money can I be approved for with a jumbo mortgage?
Answer: Depending on the individual's credentials and what state the property is located in, you may qualify for financing ranging from $424,101 up to $10,000,000.
Do jumbo loans usually require a down payment?
Answer: Yes. In fact, lenders often require a higher than usual down-payment on a jumbo loan, commonly around 20%. However, there are portfolio lenders offering just 5% down jumbo mortgages up to $1,500,000 if you meet their conditions.
Will refinancing my jumbo loan to a conforming loan help?
Answer: Of course the rate you'll get will vary depending on your loan to value, whether it's a single family home, condo, or a duplex, and your credit score. You can start the refinance transaction with your preferred loan amount and pay down the principle at the closing of your refinance with escrow or you can get a second mortgage as follows: An 80% 1st loan, 5% 2nd loan. Compare the payments as usual.
Should I refinance my 5/1 ARM if it will reset in 1 1/2 to 2 years to a Fixed Rate?
Answer: While the rates are very low, you have the choice of looking into refinancing now or putting it on the market prior to the potential upward rate adjustment. Keep in mind, it is likely the home may not appraise for what you think it's worth. With that being said, you will not know until you consult with local lenders.
Can I a get a loan for a second home or vacation home using a jumbo mortgage program?
Answer: Sure, you can finance any second home / vacation property as long as it is eligible using a jumbo or super jumbo loan program subject to you meeting income, credit, down payment, debt ratios, and other lender stipulations.
Are there any stated income jumbo loans and if so, at what rate/cost?
Answer: Fortunately, there are only a few niche mortgage lenders who do offer stated income loans on investment properties. Otherwise, you should look into the "Bank Statement Loan" or "Asset Qualifier Loan" if you need to avoid providing tax returns.
The financing is capped at 70-80% loan-to-value for a purchase or refinance. Credit score is typically 680 or higher along with additional qualifying criteria. It is always best to dicuss your situaiton with a licensed loan originator.