What is a Jumbo Mortgage?
When you’re beginning the mortgage process, you may start coming across many terms you’re not familiar with. At Guaranteed Rate, we know educating our customers is one of the most important parts of helping them obtain a loan.
Today we wanted to break down what a Jumbo mortgage is and if it’s a loan option for you.
A jumbo loan is a mortgage with a loan limit exceeding the conforming loan limits. This is $417,000 in most areas, but in more expensive places, it can be as high as $729,750. These limits have been set by the Office of Federal Housing Enterprise Oversight or OFHEO and any loan over these limits are not eligible to be purchased by Fannie Mae or Freddie Mac.
If you’re looking to get a loan over these limits, you won’t have to worry about having fewer options. Jumbo mortgages are available in fixed or ARM, same as conventional mortgages. You can also choose to have the loan be standard or interest-only if you desire. For more information on jumbo mortgage options, click here.
A jumbo loan is a great option if home prices in your area tend to be high, not leaving you many other options due to the high-value real estate. In addition, if you have a large salary, but haven’t saved enough money up to bring your loan amount down to conventional limits, then a jumbo mortgage could be the answer for you, if you feel comfortable with the larger monthly payments.
Other benefits of a jumbo mortgage include building credit quickly and if you’re looking for a great option for long-term financing. If you want to discuss your mortgage options further, contact one of our expert loan officers who would be happy to help you.
Or see how much you can afford here.