Jumbo

A jumbo loan is considered a non-conforming loan as the balance of the loan exceeds the conforming loan limits recognized by Fannie Mae and Freddie Mac that are set by FHFA (Federal Housing Finance Agency). When a loan is non-conforming, the risk for the lender is greater compared to other loan programs. There isn’t the same standardized set of rules for the investor to follow so lenders create their own guidelines for these mortgages. Therefore, Jumbo mortgage underwriting requirements are usually stricter than a conforming loan. Most often these loans require a larger down payment and higher credit score.

Jumbo loans are available for owner-occupied, second-home, or investment purchases and refinance. Limitations vary from lender to lender.