What Makes a Mortgage Jumbo?
Conforming loan limits establish the maximum size for loans eligible under standard agency parameters in a particular area.
Financing above the applicable limit generally requires jumbo or another non-agency solution.
Jumbo underwriting is lender-specific, which makes program comparison particularly important.
Income and Asset Analysis
Jumbo borrowers frequently have complex financial profiles involving bonuses, commissions, businesses, partnerships, investment income or substantial assets.
Correctly documenting these sources can be as important as the amount earned.
We evaluate the borrower's financial structure before determining which jumbo programs are realistic.
Reserves and Liquidity
Many jumbo lenders require borrowers to retain substantial assets after closing.
Required reserves can depend on loan amount, occupancy, property count and other risk factors.
A borrower capable of making a larger down payment may therefore choose not to do so if maintaining liquidity produces a better overall financial position.
Down Payment and Loan-to-Value
Jumbo does not automatically mean 20% or more down.
Available loan-to-value varies by loan amount, borrower strength and lender.
We compare the cost and benefits of different down-payment levels rather than assuming maximum leverage or maximum equity is always best.
Pricing a Jumbo Loan
Jumbo rates do not necessarily move identically to conforming mortgage rates.
At times jumbo financing can be surprisingly competitive.
Because the balances are large, we evaluate rate together with points, lender credits and transaction costs in actual dollars.