Have your heart set on that big dream house? It may require a big mortgage, too—more than the established conforming loans limits set by the Federal Housing Finance Agency (FHFA). When you borrow a home loan above and beyond the conforming loan limits you will need a jumbo loan. If you are looking to purchase or refinance a high-balanced or luxury home, Certainty Home Loans offers Jumbo home loans options for you. They allow you to borrow above the Fannie Mae and Freddie Mac “conforming” home loan limit for a single-family home. The underwriting process is similar to a conforming loan, but there are some differences, such as slightly higher interest rates and down payments.
What’s your conforming loan limit?
Every county in the U.S. has its own conforming loan limits. Loan limits can change each year and are set each January 1st. In 2020 the loan limits range from $510,400 for much of the U.S. to $765,600 for high-cost areas. Click here to view the limits in your area. Jumbo loans provide financing for homes that cost more than the conforming loan limits in your area.
Highlights of Jumbo Home Loans
- Conventional Jumbo home loans are available for primary residences, second or vacation homes and investment properties.
- Often, they carry higher interest rates and points.
- Some areas that the federal government designates as high-balanced home markets may receive a higher limit in a conforming loan program.
- Select from fixed-rate, adjustable rate mortgage (ARM) or interest-only home loan programs.
- Larger down payments are usually required on these loans.
It is a good idea to speak with your Certainty Home Loans mortgage professional to learn about the conforming loan limits in your area.
Jumbo home loan sample scenario:
$650,000 sales price. $65,000 down payment. $585,000 loan amount. $3,276.00/month (P&I), 30 year fixed 5.375% interest rate, 5.403% APR. APR current as of 12/3/2019 is subject to change daily without notice and assumes a minimum FICO score of 720. No HOA fees on an owner occupied single family residence. Monthly payment does not include taxes and insurance, the actual monthly obligation will be higher. Conventional loan amount based on an LTV of 90.00%. Mortgage insurance: $185.25. Closing costs for 30 year fixed rate loan estimated to be $7,296.