TEXAS FIVE STAR LENDER

Jumbo Loans

A jumbo loan is a mortgage that surpasses the conforming standard loan limits set by government-backed agencies like Fannie Mae and Freddie Mac. These loans are different from other mortgages because they are designed for pricier properties.

The conforming limit for most parts of the country in year 2024 is $766,550. This means that in most parts of the country, if you need to take out a mortgage for more than $766,550 in 2024, you'll need to apply for a jumbo loan. Depending on where you are buying, though, the conforming loan limits can be as much as $1,149,825.

Because of the higher loan amount, requirements tend to be stricter. Most lenders will require a minimum credit score of 700 and a debt-to-income (DTI) ratio lower than 45%. Also, lenders typically require a 20% down payment for a single-family home and higher down payments for multifamily units. Jumbo Loans are often subjected to premiums on interest rates and other restrictions.

Table below shows the comparison between a none-conforming jumbo and conforming loans differ: