Purchase Loans
Jumbo loans are mortgages for loan amounts that exceed the conforming limits set each year by the Federal Housing Finance Agency — $766,550 in most U.S. counties for 2024, up to $1,149,825 in high-cost coastal markets like parts of California, New York, and Washington, D.C. Because jumbo loans aren’t eligible to be purchased by Fannie Mae or Freddie Mac, they’re funded and held by private lenders or sold to investors on a case-by-case basis. That changes everything about how they’re underwritten. Jumbo guidelines are stricter than conforming guidelines: higher credit score minimums (usually 700+), higher reserve requirements (often 6–12 months of PITI in liquid assets), tighter debt-to-income ceilings (43% is a common cap), and deeper documentation scrutiny. But the upside is flexibility — jumbo programs can accommodate loan amounts well into seven figures, multiple investment properties, larger lot sizes, unique collateral, and complex borrower structures that conventional guidelines reject outright.
Jumbo loans are for amounts above the conforming limit set annually by the FHFA. The floor is $766,550 for 2024; ceiling in high-cost counties reaches $1,149,825.
Because these loans aren’t backed by Fannie Mae or Freddie Mac, lenders typically require credit scores of 700+, DTI under 43%, and 6–12 months of reserves.
Down payments are typically 10–20% for primary residences, 15–25% for second homes, and 20–30% for investment properties.
Rates, leverage limits, and terms vary more between lenders than conforming loans — shopping multiple lenders can meaningfully change your total cost.
Jumbo ARMs often carry noticeably lower initial rates than jumbo fixed-rate loans, which is why many higher-net-worth buyers prefer 7/6 or 10/6 ARMs on large loans.
Appraisals on jumbo loans often require two appraisals above certain loan thresholds, and lenders scrutinize comparables more carefully than on conforming loans.
Income $400k+ per year, buying at $1.2M with 20% down. Conforming limit is $1,149,825 in the metro, so the loan size just clips into jumbo territory. A 10/6 jumbo ARM often prices noticeably lower than a jumbo fixed for this profile.
Primary residence in the Northeast, buying a $900k second home in Florida or Colorado. Jumbo second-home programs typically require 20–25% down, 700+ credit, and 6+ months of reserves on both properties.
Business owner with steady net income but variable tax returns. Bank statement jumbo programs can qualify the loan off 12–24 months of business deposits instead of personal tax returns.
Borrower with $3M+ in liquid assets but lower W-2 income. Some jumbo programs allow asset-depletion calculations — dividing investable assets by 60 months to create a qualifying income figure.
Selling a $600k home with $300k in equity, buying a $1.4M home. Puts $400k down (combines equity plus savings) and finances $1M as a jumbo — commonly structured as a 30-year fixed or 10/6 ARM.
Loan amount $960,000. At a 6.875% jumbo fixed rate, monthly principal and interest is about $6,309. No mortgage insurance on most jumbo products above 80% LTV because jumbo insurers rarely participate at this size. Total PITI often lands near $8,200 after taxes and insurance.
Loan amount $1,050,000 at an initial 6.375% rate on a 10/6 ARM. Monthly principal and interest about $6,553 for the first 10 years. If the borrower refinances or sells before the fixed period ends, the ARM structure never adjusts. Typical break-even versus jumbo fixed is 3–5 years.
Borrower has $4M in liquid investments, modest W-2 income. Asset-depletion math: $4M ÷ 60 months = $66,667/month in qualifying income. Combined with actual W-2 income and other sources, the borrower qualifies for a $1.6M jumbo loan despite a DTI that would otherwise fail.
Example figures use illustrative rates and are for educational purposes only. Actual rates, terms, and costs depend on credit profile, market conditions, and property specifics.
The only real advantage of conventional is looser underwriting — lower credit score minimums, lower reserves, higher DTI ceilings. Once your loan size clips above the conforming limit for your county, you’re in jumbo territory automatically.
Full-doc jumbo is priced slightly better and has the most lender competition. Bank statement jumbo is useful for self-employed borrowers whose tax returns understate income — the tradeoff is a rate premium of roughly 0.25–0.75%.
Fixed-rate jumbo is the safe choice for long-term holds; jumbo ARMs deliver a lower starting rate for 5, 7, or 10 years and usually win the math if you plan to sell or refinance before the fixed period ends.
Portfolio loans are kept on the lender’s books and can flex on scenarios no jumbo program will touch — unusual collateral, multiple financed investment properties, entity structures. Rates are typically higher than standard jumbo in exchange for that flexibility.
Explore the programs jumbo loans — financing above $766,550 are most often compared against, plus the Purchase Loans hub for the full lineup and today's mortgage rates for current pricing context.
When the amount you need to borrow is more than the conforming loan limit for your county, the loan is considered jumbo. These limits change annually and vary by location.
They can be. Because these loans are larger and not backed by government programs, lenders typically look for stronger credit, more reserves, and a solid overall financial profile.
Yes, investment property options are available — though the qualifying standards and down payment requirements are typically higher than for a primary home.
The baseline (floor) is $766,550 in most U.S. counties. High-cost counties — many in California, New York, and parts of Washington, D.C. — have limits up to $1,149,825. Anything above your county’s limit is jumbo.
Most jumbo programs require 6–12 months of PITI (principal, interest, taxes, insurance) in liquid reserves after closing. Multiple properties typically require even more. Retirement accounts count at a discounted rate.
Most jumbo products don’t offer PMI at all — they require 10–20% down instead. A few lender-paid mortgage insurance (LPMI) structures exist for borrowers who want to put less down, but the rate premium often costs more than saving for the larger down payment.
A method that lets high-net-worth borrowers qualify using their liquid assets. Lenders divide investable assets by 60 months (or similar) to calculate a qualifying monthly income figure, even if actual W-2 income is modest.
Fixed is the safe choice for long-term holds. ARMs make sense when the rate spread is meaningful and you plan to sell or refinance before the fixed period ends. On a large loan, a 0.5% rate advantage saves substantial interest over 5–10 years.
Above certain loan sizes (typically $2M) lenders require two independent appraisals to validate the property value. The lower of the two generally controls for LTV calculation. It’s a risk-management safeguard on large collateral.
Yes, some jumbo programs go to 10% or even 5% down for primary residences with strong credit and reserves. Rates are usually 0.25–0.5% higher than 20%-down pricing, and underwriting scrutiny increases.
For higher-priced purchases, use the affordability calculator to see where your income, reserves, and debt load actually qualify. Then model the jumbo monthly payment in the mortgage calculator to see how jumbo rates and reserves requirements shape your PITI. Curious about accelerating a seven-figure mortgage? see payoff scenarios in the repayment calculator.