Jumbo Mortgage Programs
Here at Poli Mortgage Group, we specialize in Jumbo Mortgage Loans. A very large portion of our business each year comes out of the luxury market. Being so close to Boston’s very high end neighborhoods and suburbs has helped us become an authority on jumbo mortgages in the Boston area.
We offer Jumbo Mortgages in:
New England, Maryland, Virginia, North Carolina, South Carolina, Tennessee, Georgia and Florida.
We offer a very wide range of Jumbo Programs in terms of property type, products and loan sizes.
Jumbo Property Types:
Primary Residence
Second Homes
Multi-Family
Vacation Rentals
Single Family, Condominium or Brown Stone
Jumbo Products:
Purchase or Refinance
10, 15 or 30 Year Fixed Rate Fully Amortizing
10 Year Fixed Rate with a 30 Year Amortization
5 Year Fixed ARMs
3 Year Fixed ARMs
Jumbo Loan Amounts:
Up to $3,000,000
Significantly higher in some geographic locations
Depending upon where you live, the term “Jumbo” will be heard with more or less frequency. In relation to mortgage loans, “Jumbo” means anything above the conforming loan limits as established by the Federal National Mortgage Association or FNMA (Fannie Mae) or the Federal Home Loan Mortgage Corporation, or FHLMC (Freddie Mac).
Both entities have established their own lending guidelines, many of them similar and some different. Such loans may require a certain credit score, require a certain percentage or amount of discretionary income, or that debt to income ratios be at a particular number.
If a mortgage loan is underwritten to either standard it is said to “conforming,” having conformed to established guidelines. One of these guidelines is assigned to the maximum loan amount.
What is particularly different from a jumbo loan and a conforming loan?
For starters, jumbo rates are sometimes slightly higher than conforming rates for the very same product. If for instance a 30 year fixed rate mortgage can be found around 4.50% then a jumbo rate will be higher, generally around ½ to ¾ percent higher, or in this example 5.00% for a fixed jumbo mortgage.
Jumbo rates will be slightly higher primarily because there is no major secondary market for the buying and selling of jumbo mortgages when compared to the more liquid conforming mortgage market.
Jumbo Mortgage Program Guidelines
Further, jumbo lenders may also have additional guidelines of their own for these mortgages that other lenders may not. For example, one jumbo lender may require 25% down while another might require 20% down for the same 30 year mortgage program.
Some niche jumbo lenders will only lend in certain zip codes or even certain parts of town. In this case a geography specific jumbo lender will occasionally allow for special property types or even relaxed credit and income standards. When a portfolio jumbo lender determines they are very comfortable with a specific region they are ok with relaxing certain other standards.
Poli Mortgage offers inhouse underwriting for many prime jumbo mortgage programs and portfolio jumbo products designed for the Boston area.
Documenting a Jumbo Loan
A jumbo lender could ask for additional requirements when approving a condominium compared to a single family residence. Still others will want to see higher credit scores while others jumbo lenders ban the use of subordinate financing. Due to these special guidelines jumbo lenders can implement, the secondary market is much smaller which results in higher overall rates.
A Low Jumbo Mortgage Rate in Boston, MA, or Greenwich, CT where home prices are much higher than the national average, will find more lenders offering jumbo rate programs, thus more competition.
When there is more local competition, you can expect rates to be slightly lower when compared to areas where jumbo loans are less common. Plus, lenders who place more jumbo loans than other types of loans can be more competitive than those who do not specialize in the product.
Jumbo mortgages in Boston are very common and we are proud to offer the lowest interest rates available anywhere in the area.
Down Payment Requirements
One characteristic of most all jumbo mortgages available today is the requirement for at least 20% down for both a purchase and a refinance. While conforming loans might ask for only 5% down or FHA needs only 3.5% for a down payment, jumbo borrowers will need to be prepared for a minimum of 20% down.
The old adage, the bigger you are, the harder you fall can certainly come into play in luxury real estate. If a home is worth $2,000,000 and you think it is excessive that you would need to put $400,000 down (20%), keep in mind that this home could have far more dramatic shifts in value.
Jumbo mortgage programs can also have their own maximum loan amounts as determined by the lender's guidelines with the most common maximum loan amount being $2.5 million. And while lenders may go above that maximum, when they do, they may also require more money down. Our Boston area jumbo loans are very flexible, we understand the property types, market and the neighborhoods.
Overall, jumbo mortgages, while more readily available today than they were just a couple of years ago are more stringent in terms of qualifying, specifically with regards to credit scores, down payment and debt to income ratios.
Yet for those who do qualify for jumbo financing, some of the most competitive jumbo rates ever issued are available today for both a purchase and a refinance transaction.
Contact Poli Mortgage Group, when you call, ask to speak with a Member of our Jumbo Lending Team.
