Jumbo Mortgages

A jumbo mortgage is a mortgage above the industry standard cap of conventional loan limits. Currently, that limit is $417,000 for Fannie Mae and Freddie Mac backed loans. Jumbo mortgages apply when the loan is greater than those limits (which are reviewed each year).

Jumbo Mortgage Loan Options

For lenders these loan are more of a risk so the interest rate charged can be anywhere from 0.25 to 1.50% higher than conventional loans.

However, the jumbo loan options are similar to the traditional FHA, fixed rate and adjustable rate mortgage (ARM’s) loan options. In fact, because of the loan size many lenders offer variable loan products to the borrower.

No money down options are generally not available for jumbo loans. Plus jumbos require up to 5% more down payment than conforming loans.

Jumbo Loan Refinancing

It can be more expensive to refinance a jumbo loan because the closing costs can be too high. Some lenders will offer an extension and consolidation agreement. This prevents the mortgage tax from being paid again on the same principal balance.

In some cases, title insurance companies will offer up to 50% discount.

If you’re seeking a jumbo, it’s best to get advice from a competent professional familiar with jumbo loans.

Steve Wyrostek -HomeLoans.org Expert A 20 year plus veteran of the insurance industry, Steve managed departments in the personal and commercial lines areas of major insurers. He’s familiar with how insurance—ranging from boat to workers compensation—works.