A Jumbo loan, also referred to as a Non-Conforming loan, is a type of mortgage that is used to purchase high-priced homes. Jumbo loans can be used for Primary, Secondary, and investment properties in excess of conforming loan limits set by government-sponsored entities such as Fannie Mae and Freddie Mac and can reach up to $3M.
While guidelines for Jumbo loans are a little more strict than conventional loans, many people are unaware that the guidelines have become more relaxed in recent years. Depending on the loan size, qualified borrowers can get a Jumbo loan without Mortgage Insurance for as little as 10.01% down payment! Lenders are also often willing to accept credit scores starting at 680.
However, there are a few things to keep in mind when considering a Jumbo loan. Due to the higher loan amounts and associated risk for the lender, Jumbo loans often have a higher interest rate and larger down payment requirement compared to a conventional mortgage loan. Some lenders will also require that a borrower have cash reserves to prove their capability of making the payments
Despite these challenges, Jumbo Home Loans can be a valuable resource for high-net-worth individuals in Cape Coral and the surrounding Southwest Florida region who are looking to purchase a luxury home.