Government-backed loan programs and certain conventional loan options are generally limited to certain amounts depending on your location. Anyone interested in more expensive luxury homes, second homes, or investment properties will need to look to alternatives not insured by the government. One of the most common loans for these types of properties is the Jumbo loan. Rick Bernstein of Assured Mortgage Inc. offers great rates and flexible terms on jumbo loans throughout Brookfield.
Most of the conventional loans offered today are purchased by Fannie Mae and Freddie Mac. To be eligible for purchase, loans must meet certain requirements. Those that meet these requirements are classified as conforming loans. Those that do not are nonconforming loans. A conforming loan cannot exceed $424,100, although in some high-cost areas, loans up to $636,150 may still qualify. A jumbo loan is simply a conventional loan that exceed the limit to be considered a conforming loan.
Since a lender cannot sell a jumbo loan to Fannie Mae or Freddie Mac, they tend to be more difficult for borrowers to qualify for. On the other hand, lenders can also be flexible with borrowers since jumbo loans do not need to adhere to Fannie Mae and Freddie Mac guidelines. While each can set their own unique requirements, most mortgage companies will follow common industry standards when qualifying borrowers.
Brookfield Jumbo Loan Requirements
- Credit Score – A credit score around 700 is generally needed. Factors such as income and down payment availability will impact the required score.
- Down Payment – A 20% down payment is often required for a jumbo loan. For those with better than average income and credit, smaller down payment options may be available.
- Debt-to-Income Ratio and Income – A debt-to-income ratio of 43 percent is generally required although this can vary on a case by case basis. W2 forms, recent paystubs, and other similar documentation will be needed at the time of application to verify income.
- Property – The property being purchased will need to support the purchase price and the mortgage being applied for.
When applying for a jumbo loan, you should be prepared to provide documentation that outlines liquid assets, non-liquid assets, and any additional loans you may have. This information will be used to further support your ability to repay the loan amount you are requesting.
Brookfield borrowers interested in purchasing an investment property, a higher-priced home, or even a second home, will find jumbo loans to be an excellent option. Contact Rick Bernstein of Assured Mortgage Inc. today for more information on jumbo loans options in Brookfield or to apply for your jumbo loan today.