What is a Jumbo Loan?
Are you buying a luxury single-family home or condominium? Lord Mortgage offers “jumbo” loans as high a $2.5 million or more. These loans are larger than the maximum limits for conventional mortgages set by Fannie Mae. Our programs can accommodate purchasers of primary residences, second/vacation homes and investment properties.
Jumbo mortgages are often a confusing idea to newer prospective homeowners, but these products have the right name. The term “Jumbo Mortgages,” coined around 30 years ago, applies to any mortgages available above “conforming” loan limits. Conforming mortgages are those eligible for purchase by Fannie Mae (Federal National Mortgage Association) or Freddie Mac (Federal Home Loan Mortgage Corporation). Jumbo mortgages are available to home buyers who need larger loans to complete their real estate purchases.
How Jumbo Mortgages Work
Jumbo mortgages work like all others. The notable difference is in their size. Fannie Mae and Freddie Mac set conforming loan maximum amounts annually. Current maximums are $417,000 for most single-family homes. Should you need a higher mortgage than the current maximum, a jumbo loan is a great choice. Most qualification documents and requirements for jumbo mortgages are similar to conforming rules; income, debt and asset verification documents are usually identical.
Jumbo Mortgage Types
Most jumbo loan products are similar or identical to most conforming mortgages. You can choose fixed-rate or adjustable-rate mortgages (ARMs). You normally have ARM options for six-month or one, three and five year loans. Even in the current “tight” credit environment, you might find a few interest-only mortgages to help you qualify based on your income and debt load. The only difference is the amount of the loan — the minimum you can borrow is $417,001.
If you want that perfect luxury property, a jumbo loan with the lowest rates is a perfect choice from Lord Mortgage.