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LET'S GO JUMBO?
Can you say "LUXURY!" Are you ready to Refinance your luxury home? Or maybe you're looking to make some additions to your home and now you need a larger loan amount to cover it. Regardless of your situation, Jumbo Refinance loans are designed for higher priced mortgage loans...and we know Jumbo! Let's get stared!Show Less
LET'S GO JUMBO?
Can you say "LUXURY!" Are you ready to Refinance your luxury home? Or maybe you're looking to make some additions to your home and now you need a larger loan amount to cover it. Regardless of your situation, Jumbo Refinance loans are designed for higher priced mortgage loans...and we know Jumbo! Let's get stared!
How are Jumbo loans Different?
A Jumbo mortgage is a home loan with an amount that exceeds conforming loan limits imposed by Fannie Mae and Freddie Mac, the two government-sponsored enterprises that buy mortgages from lenders. The limit is $417,000 in most parts of the United States, but is $625,500 in the highest-cost areas and in-between in others.
Generally the qualifying factors are the same as a conventional loan. However, the down payment and credit worthiness requirements are less flexible as the risk is greater with larger loan amounts.
Here are some of the advantages of a Jumbo loan!
What are the requirements for a Jumbo loan?
Jumbo loans come in to play when the property cost exceeds the mortgage conforming limit: They start at $417,000 for most parts of the country and as high as $625,501 in some higher-priced real estate areas.
If you’re planning to buy expensive property, a jumbo loan is a viable option. Here are some of the standard qualifying factors you’ll need to be aware of. Give us a call today and we’ll crunch some numbers to make sure this is the right move for you.
Main points of qualification for Jumbo Loans!
General Income Requirements
To qualify for a jumbo loan, you’ll need to be able to prove you have the income and liquid reserves to cover the payments. Traditional borrowers will need recent pay-stubs dating back 30 days and W2 tax forms stretching back two years to prove income.
Self-employed borrowers will still have more of a challenge than salary borrowers. If you’re self-employed, be ready to show two years of tax returns and at least 60 days of bank statements. You’ll also need liquid assets to qualify: Come prepared with six months of reserves of the new mortgage payments.
Due to the higher dollar value of these loans, credit score requirements are higher for jumbo loan applicants. You’ll need at least a 680 credit score to qualify for most jumbo loans. However, all Investors set their own credit score requirements, and some lenders may require a higher score for approval.
While applying may be tougher, jumbo loan borrowers may have one thing to look forward to: lower down payments.
In the past 20% to 30% [down payment] would be needed for a jumbo loan. These days only 10% would be needed with good credit. But keep in mind that putting a smaller payment down upfront can affect your mortgage terms.
Many jumbo loans are qualified mortgages, a system developed by the Consumer Financial Protection Bureau to standardize mortgage terms. If you apply for a qualified mortgage, your debt-to-income ratio cannot exceed 43%.
If your debts push you over the limit, you can still apply for a non-qualified mortgage, but the lender will still need to verify you can comfortably repay the loan.
Qualified mortgage rules have increased the need for documentation. While borrowers may have been approved for a jumbo loan with limited paperwork in the past, that is no longer the case.
When you apply, you’ll need to provide documentation to back up any claim you make, including the following:
- Proof of income from all sources
- Proof of liquid assets
- Documentation on other loans you hold
- Proof of ownership of non-liquid assets like other owned properties
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