A jumbo loan, also known as a jumbo mortgage, is a type of home financing that exceeds the standard limits set by the Federal Housing Finance Agency (FHFA). Jumbo loans are used to purchase luxury homes and expensive properties that cost more than the FHFA loan limits.
3 Common Myths About Jumbo Loans – You Should Know
- Jumbo Loans Are Only for Buying Mansions. There’s a common misconception that jumbo loans are only for people looking to buy lavish mansions. In reality, a jumbo loan is simply a mortgage that exceeds the conforming loan limit set by the Federal Housing Finance Agency (FHFA). The limit is currently $510,400 for a single-family home in most parts of the country, but it can be higher in certain high-cost areas. While it’s true that you can use a jumbo loan to buy a luxurious home, you don’t have to be extremely well-off to qualify. Jumbo loans are available to anyone who meets the eligibility requirements, which vary by lender. In most cases, you’ll need a good credit score, a healthy debt-to-income ratio, and a down payment of at least 20 percent. If you’re looking for a loan to buy a home that’s priced above the conforming loan limit, a jumbo loan could be a good option. Just be sure to shop around and compare offers from multiple lenders to find the best deal.
- First-Time Homebuyers Can’t Apply for a Jumbo Loan. First-time homebuyers can absolutely apply for a jumbo loan. In fact, there are many first-time homebuyers who take out jumbo loans every year. The reason this myth exists is that there are some lenders who have stricter requirements for first-time homebuyers when it comes to jumbo loans. But this doesn’t mean that all lenders have these stricter requirements. If you’re a first-time homebuyer that is interested in a jumbo loan, talk to a few different jumbo loan lenders to see what their requirements are. You may be surprised to find that you qualify for a jumbo loan with some lenders. Don’t let the myth that first-time homebuyers can’t apply for a jumbo loan stop you from pursuing your homeownership dreams. Talk to a jumbo loan lender today to see if you qualify.
- Minimum Down Payment for a Jumbo Loan Is 30 Percent. One of the most common jumbo loan myths is that you need a minimum down payment of 30 percent in order to qualify. This simply isn’t true. While a higher down payment can make it easier to qualify for a jumbo loan, it’s not a requirement. In fact, you can qualify for a jumbo loan with as little as five percent down, depending on the lender. So why do so many people believe that you need a 30 percent down payment for a jumbo loan? Well, it’s likely because, in the past, this was the minimum down payment required. But times have changed, and lenders have become more flexible when it comes to jumbo loans.
It’s important to be aware of the common myths associated with jumbo loans. While these loans can be more expensive and harder to qualify for, they don’t necessarily have to be. With the right planning and preparation, you can secure a jumbo loan that fits your needs and budget.
Contact Your Roswell Mortgage Specialist Today!
Apply for a jumbo mortgage with the help of Buckhead Home Loans. We are a boutique brokerage shop that serves homebuyers and homeowners throughout the Fulton County, Georgia area and throughout the states of Georgia, North Carolina, South Carolina, Alabama, and Florida. Apply now or contact us today at (404) 303-7411 for more information.