Jumbo Loans

Jumbo Loans: Everything You Need To Know

Get ready to learn in this page about: 

What Is a Jumbo Loan?
Jumbo Loan Limits?
Jumbo Loan Requirements.
Jumbo vs. Conventional Mortgages: What’s the Difference?
Frequently Asked Questions about Jumbo mortgages.

What Is a Jumbo Loan?

A mortgage loan is considered jumbo if the loan amount of the mortgage exceeds loan-servicing limits set by Fannie Mae and Freddie Mac — currently for 2024 being $766,550 for a single-family home in all states (except Hawaii and Alaska and a few federally designated high-cost markets, where the limit is $1,149,825)

What types of properties can be financed with a jumbo mortgage?

Jumbo mortgages are available for primary residences, second or vacation homes and investment properties, and are also available in a variety of terms, including fixed-rate and adjustable-rate loans. A jumbo loan will typically have a higher interest rate, stricter underwriting rules and require a larger down payment than a standard mortgage.

Why are jumbo loans potentially more risky for lenders compared to conventional loans?

Jumbo loans are considered riskier for lenders because these loans can’t be guaranteed by Fannie Mae and Freddie Mac, meaning the lender is not protected from losses if a borrower defaults. Since they can’t be resold, jumbo loans generally remain on the lenders’ own books, making them a type of portfolio loan.

What are the Jumbo Loan Limits?


Jumbo loans that are generally used to buy expensive properties. There are no limits to Jumbo mortgages. Each lender sets their upper limit jumbo mortgage amount preference, so you may be able to borrow up to $50 million or more—depending on which lender you borrow from and their jumbo mortgage limit. However, they have much stricter requirements than conforming loans because they’re riskier for the lender.

Jumbo Mortgage Loan Requirements:

Lenders want to be sure their loans will be repaid even in the event of financial hardship. Three of the primary requirements for jumbo loans are a high credit score, low debt-to-income (DTI) ratio and good cash reserves.

The general loan requirements are:

A down payment of at least 10%, but some lenders may require more. The standard down payment required for a jumbo loan will be 20% of the loan amount (i.e., the home’s selling price). Some mortgage lenders may request a jumbo loan down payment as much as 25% or 30%. At the same time, some borrowers may qualify for a jumbo loan with a 10% down payment.

The maximum debt-to-income ratio (DTI) for jumbo loans is usually 43% Your DTI is the percentage of your monthly earnings used to pay off all debt obligations and it’s used by lenders to determine how large of a monthly mortgage payment you can handle.




Most lenders want to see ample cash reserves and at least six months’ worth of mortgage payments. Some other lenders would want to more, sometimes all the way to 24 months of cash (or liquid assets) in your Bank Account. The exact amount required for cash reserves varies by lender and may change based on your credit score, DTI ratio, the type of property you’re financing, and how many homes you have financed. 

A FICO score of 700 or higher, and sometimes as high as 760


Extensive documentation, such as full tax returns, W-2s, 1099s, bank statements, and investment account information

More than one home appraisal



Jumbo vs. Conventional Mortgages: What’s the Difference?

A Jumbo loan is a Conventional loan however, it is not a conforming loan. People generally mistake a Conventional loan for a Conforming loan.

Conventional loans are all mortgage loans that are not government-backed, like Conforming, Jumbo, and DSCR loans. Government loans are FHA, VA & USDA.

On January 1, 2024, the conforming loan limit increased to $766,550 in most of the U.S. In high-cost areas, it increased from $1,089,300 to $1,149,825. 

Conforming loans are those who “conform” to Fannie Mae & Freddie Mac guidelines. In 2023, the conforming loan limit for conventional loans was $726,200. The Federal Housing Finance Agency (FHFA) sets this limit based on its House Price Index, which increases as home prices rise. 

If your loan amount exceeds the conforming loan limit for your area, it’s considered a Jumbo loan. Jumbo loans may have stricter qualifying requirements and potentially higher interest rates compared to conforming loans.


Jumbo mortgage rates have historically been higher than Conforming loans; however, in the past two years, they have been very similar.




Frequently Asked Questions about Jumbo mortgage

What is the definition of a jumbo home loan?

How much is a jumbo loan? A jumbo loan is a mortgage loan that is larger than the conforming loan limit set by the U.S. government, which is currently $766,550 in most areas of the U.S.. The loan limits are higher in some high-cost counties in continental United States and Puerto Rico, and higher still in Alaska, Hawaii, Guam, and the U.S. Virgin Islands.

How many months of reserves are needed for a jumbo loan?

Substantial cash reserves required: Jumbo loan borrowers are often required to have six to 12 months’ income-available cash reserves, while a few lenders require 24 months.

What are the benefits of a jumbo loan?

– Flexible terms: Jumbo loans have flexible terms for how much money can be borrowed and what types of properties can be financed.
– Co-borrowers: Jumbo loans allow for a co-signer who won’t be living at the property to sign the loan agreement with the borrower.
– Fixed-rate and adjustable-rate programs: Jumbo loans can be fixed-rate or adjustable-rate mortgages.
– Potentially lower interest rates: ARM rates can be 1% lower than fixed-rate mortgage rates.
– No Private Mortgage Insurance (PMI) required if less than 20% down.

Do jumbo loans require mortgage insurance?

Typically, borrowers making a down payment of less than 20 percent of the purchase price of the home will need to pay for mortgage insurance. However, you do not need mortgage insurance on Jumbo loans originated by Bluecastle Lending

Are jumbo loans harder to qualify for?

Yes, they are harder to qualify. For a jumbo loan, you’ll need a higher credit score — and possibly a higher income, down payment or more assets — than you would for a conforming loan. For example, you need a minimum of a 700 credit score to be considered for a jumbo loan versus 620 for a conforming loan.

Are jumbo loan interest rates lower than conventional?

Historically, jumbo loan mortgage rates are higher rates than conventional loans. However, in 2022 and 2023, jumbo loan rates were almost the same as conforming loans. As of December 7, 2023, the national average for a 30-year fixed-interest jumbo rate for a jumbo loan was 7.47%, compared to 7.42% for a 30-year fixed-rate mortgage.

What are ‘conforming loans’?

A conventional loan is a broader category than a conforming loan. All conforming loans are conventional loans, but not all conventional loans are conforming loans. Most conventional loans are called “conforming loans” because they follow specific rules set by Fannie Mae and Freddie Mac. However, there are other conventional loans that are not conforming, like Jumbo loans, Bank Statement loans, and DSCR loans. 

Is it possible to refinance a jumbo mortgage?

Yes, you can refinance a jumbo mortgage. You can refinance a jumbo loan at any time, but you’ll need to qualify with a strong financial profile. You can refinance your jumbo mortgage at any time.

What are the different types of home loans available?

There are different types of home loans, each with its own pros and cons. Some common home loans include conventional loans, jumbo loans, FHA loans, VA loans, USDA loans, fixed- and adjustable-rate mortgages, non-QM loans, and construction loans. Keep in mind that there may be overlaps with loan programs.

How often do mortgage rates change?

Mortgage interest rates can change daily, weekly, or even hourly. These changes are often influenced by economic changes, world events, and the Federal Reserve. The main factors for this flux are the economy, inflation, and the Federal Reserve Board. Rates tend to rise when the economy is strengthening, and they tend to fall when the economy is weakening.

What is the definition of a LAP loan?

A Loan Against Property (LAP) is a secured loan that allows you to use your property as collateral to apply for a loan. The loan amount is based on the property’s value and other factors. A mortgage loan.

Do I qualify for the $10,000.00 Closing Cost Assistance Credit doing a Jumbo Loan?

Yes you do, up to 1.25% of the loan amount or $10,000.00, whatever is lower. See offer terms and restrictions for more details.

Do I qualify for the Buy & FREE Refinance offer if I get a Jumbo mortgage?

Yes you do, up to $2,500.00 payable in Closing Costs. See offer terms and restrictions for more details.