Buying a new home is an exciting process. Whether it’s your first time purchasing or you’re venturing out to acquire a vacation property, you’ll likely have many questions about the home-buying process.
According to the latest data from the Federal Housing Finance Agency, the average mortgage loan in the United States is $316,700. But that doesn’t mean homeowners all choose loans that match this figure.
What happens if you need a loan that exceeds this amount and also exceeds federal mortgage limits? That’s where a jumbo loan comes in. If you’re looking to purchase a luxury home or buy property in a high cost-of-living area, a jumbo loan may be the perfect solution.
In order to be considered a jumbo loan, the mortgage must exceed $424,100, which is the current mortgage loan limit in almost every state. (There are higher limits for Hawaii, Alaska and high cost-of-living areas like Washington, D.C.)
A jumbo loan is one that exceeds the limits set by Fannie Mae and Freddie Mac, which create county-by-county conforming limits in the U.S. and also help keep mortgages affordable nationwide. Obtaining a jumbo mortgage loan will require good credit history, a low debt-to-income ratio, and the ability to make a larger down payment than what is usually expected of a homebuyer.
The higher the loan amount, the more risk it carries for the lender, so you’ll have to show why you should qualify. Additionally, jumbo loans aren’t backed by the two mortgage financiers we discussed above.
A jumbo mortgage loan typically requires 10 percent down and can be fixed-rate or adjustable.
Regardless, you’ll need professional help as you prepare for a jumbo mortgage loan.
Obtaining a jumbo mortgage loan is more difficult when compared to a traditional loan, and you’ll be required to fill out more paperwork and have more hoops to jump through when compared to loans that conform to the limits set by Fannie Mae and Freddie Mac.
If you need help determining whether you’re eligible for a jumbo loan, contact Emmanuel St. Germain today. You can reach him on his cell phone 561-400-7317 or direct line 561-362-8204.. Our team provides loans throughout Florida, Maine, New Hampshire and Colorado, and we do the work for you. Obtaining a jumbo mortgage loan will be stress-free with our help.
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