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Jumbo Loans for Luxury Properties & High-Cost Areas
Nexa’s Jumbo loan experts are dedicated to securing the right financing for you.
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Product Features
- Competitive rates and flexible down payment options for qualified borrowers
- Higher loan limits than those allowed by conventional conforming and government loans
- Fixed and adjustable-rate mortgages (ARMs) loan options available
- Programs available for second homes, investment properties and refinances
Is a Jumbo loan right for you?
Jumbo loans are typically suited for borrowers who possess strong credit scores and healthy assets looking to buy or refinance a high-priced property. Jumbo programs may also benefit borrowers with nontraditional employment statuses or sources of income, or those with complex financing scenarios.
If you live in a high-priced housing market or are considering the purchase of a luxury property, reach out to one of our mortgage consultant to discuss your options
What is Jumbo Loan?
Jumbo mortgages provide borrowers with a one-of-a-kind opportunity to purchase properties valued at more than $647,200. Although jumbo mortgages have significantly stricter financing standards than other programs, they nonetheless pack a punch in terms of improving purchasing power. A widespread misconception regarding jumbo loans is that they demand a 20% down payment to qualify. In actuality, with a little innovative finance, Jumbo Finance allows you to shop with as little as 3.5% down payment. Yes, it certainly is! It's sixteen and a half percent less than the usual twenty percent. This is accomplished by establishing a first mortgage with a regular lending limit of $ 647,200 and a second mortgage that is still outstanding. This type of "combination loan" does not require mortgage insurance and usually has the lowest fixed payments.
What are the Pros and Cons of Jumbo Mortgages?
Jumbo Mortgage Pros
- This allows for more loans and, in some cases, even better interest rates. In addition, there are some creative options available for the second mortgage.
- If you are a high-income earner with a solid financial history, credit score and larger down payment this may be the right loan for you.
- If you have a good credit score above 680 you will be more likely to qualify.
- You can get a Jumbo Loan with as little as 3.5% down in some cases if your credit score is higher than 680.
- The total amount you want to finance, credit score, and your down payment will play a major role in whether you get financing.
Jumbo Mortgage Cons
- Not guaranteed by the Federal Housing Administration or the Department of Veteran Affairs.
- Qualifying for a Jumbo mortgage can be tougher than regular loans.
- If your credit score is below 680 you will likely have to put down a much larger down payment to offset the risk of a lower credit score.
- You will need at least 6 months of mortgage payments in an asset account.
- If you are looking for a loan above $5 million you may have to look to a portfolio lender that offers super jumbo home loans. Be sure to consult with your licensed mortgage advisor for your best option.
What are the Requirements for a Jumbo Mortgage?
Here’s a list of Jumbo Loan requirements:
- Income - Your monthly mortgage payment, including taxes and fees, should not exceed 36% of your total income. If you combine this with your other debts ideally it should not exceed 43% of your gross monthly income.
- Financial History - We look at two years of income, including W2’s ,pay stubs and tax returns. If self employed we have alternate income alternatives such as 12-24 month bank statements, P&L, or 1099 statements.
- Credit Score - Your credit score (FICO) should be 600 or above. If your credit score falls below this, you are eligible for a loan. With lower scores your interest rate and mortgage insurance will be higher.
- Down Payment - Traditionally it’s been 20% of the cost of the home. The good news due to improvements to the Jumbo program you can qualify for as little as 3.5% down. Depending on the loan amount
- Cash reserves – Typically you want to have at least six months’ worth of mortgage payments available in a liquid account (think checking, saving, retirement accounts).
- Sales Price - Loan limits for jumbo loans in most counties are over $647,200.
How Long Should You Expect to Wait for a Loan to be Approved?
Usually you can expect to wait from 2 – 3 business days. If further information or documentation, which validates the accuracy of your approval, is needed, it may cause delays. The faster you provide accurate information the shorter your wait will be. The lender reviewing your profile will request an appraisal of the property, your credit report, verification of employment and financial history. To avoid delays make sure that you meet the lenders documentation requests promptly, including your up to date records.
What You Need as a Down Payment for a Jumbo Loan
A 20% down payment was common for jumbo loans, but this is no longer the case. Nowadays, you can qualify for an option with a discount of only 10%, so rely on that amount. Remember to help your mortgage adviser decide on your prepayment. Therefore, please take into account that the down payment, closing fee, appraisal fee and housing inspection fee are all included in this amount.
What is the Interest Rate and Annual Percentage Rate on a Jumbo Loan?
Note that jumbo interest rates are higher than traditional interest rates. For this reason, splitting a loan into a first and second mortgage may result in lower interest rates on the new mortgage and lower overall payments.
There is no set number. APR is calculated by diversifying the total amount of borrowing, including closing fees, over the entire term of the loan. This is the actual cost of the loan, including the interest you expect to pay during the repayment period. For jumbo or super jumbo loans, this is usually 30 years.
Myths About Jumbo Loans
Myth 1 – You will have to wait too long for approval
The paperless technology system has significantly reduced the wait time for authorization. As long as your paperwork is in place, you will get a loan you deserve. There should be no adverse delay in processing the loan.
Myth 2 – Your credit score is all that matters
Jumbo lenders focus one component in their approval to your FICO credit score rating. In reality, it`s your monetary balance and records this is the important thing issue in your approval. If you're regular with paying your payments on time and display a high-quality records of bills your credit score rating will replicate this. Having strong paintings records and profits is likewise a massive issue in getting your mortgage accepted fast. Obviously, in case you display a sample of past due bills this could have a bad effect to your mortgage being accepted.
Myth 3 – Expect more paperwork
The required documents may vary slightly, but they are very similar to other loan applications.
So which is better for you? Fixed or Adjustable Rate Mortgages?
The simple answer is that it depends on how long you expect to live in the house. In addition, the current interest rate pattern at the time of settlement determines the interest rate to be selected.
Jumbo Loan Checklist
Be prepared when arranging a phone call with a jumbo mortgage advisor. Here are some documents to keep for non-binding consultations:
- Pay slips for the last 30 days, or recent holiday and earnings stubs
- W2s for the last two years for all borrowers and all employers
- Last two years of complete tax returns (if self-employed)
- Government issued ID (driver’s license or id card)
- Most recent bank statement (all pages)
- Purchase contract (If executed)
- Be sure to ask your Jumbo mortgage adviser for the specific documents needed for your unique mortgage situation.
Jumbo Loan Pre-Approval Letter
Once your jumbo mortgage advisor has the correct information and you complete your application, they will complete your approval and look up all the details with you. You will also receive a pre-approval letter so that you can start shopping for your new home. This is an important step as it informs the seller that they are seriously authorized to buy their home. Your agent will use pre-approval to negotiate and help you make the best deal for your home.
What people say about us.
Here are comments from our beloved clients
Very knowledgeable about the business and will never leave you astray. He made sure both my purchase and refinance was a smooth process. If you’re looking for someone with tons of experience and knowledge, look no further.
The Altidors
Tony was instrumental in helping me get a loan with a great rate using bank statements as I was on a tight timeline, and was unable to get my tax returns completed in time. I would highly recommend using Tony if you’re in need of a mortgage.
Adam Baskin
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