In most areas of the United Staes, a conforming loan is maximized at $424,100. However, in some areas, particularly in high housing markets and specific geographic locations, the jumbo loan limit can be as high as $636,150.
The Jumbo Loan Market
Many people assume jumbo loans are used to purchase luxury custom homes and elaborate properties. In fact, in many areas of the country, a jumbo loan may be required to purchase an average size of an older home, it is really based on the local market and the economy.
For homeowners, using a jumbo mortgage calculator is a simple way to learn about the reality of these types of loans. Of course, the applicant will still need to qualify, which will be more challenging than the qualifications for a conforming loan. Typically, credit scores must be above 740, and the down payment for the jumbo loan is typically at or above 10%, but this can vary by lender.
What to Consider
It may be surprising for some home buyers to see the rates in the jumbo mortgage calculator. They may be at the same level as a conventional loan or, in some cases, they may be slightly less.
Using the calculator to determine the estimated monthly payment for these larger loans is important. Be sure to consider the cost of a 30 year, 20 year and 15 year jumbo loan. Knowing what to expect for monthly payments on the loan is an essential part of using the jumbo mortgage calculator.
Check to verify the down payment you are able to make. Consider boosting the down payment to at least 20% through the calculator to see the savings in both estimated monthly payments as well as rates.
Other costs that will vary from lender to lender include closing costs, lender’s fees, mortgage insurance, and taxes. Some calculators have this information set in the program while others allow the user to make changes.
At Guaranteed Rate, our expert lenders will walk you through the application process for a jumbo loan. You can also use our jumbo mortgage calculator and read more about these loans.
