What is a Jumbo Mortgage Loan?

These loans are also referred to as non-conforming conventional mortgages; they generally have higher interest rates because, as the lender is not protected from loss if a borrower defaults, it is riskier for the lender. Jumbo mortgage loans typically have fixed or adjustable interest rate options.


  • These loans typically require a higher credit score – around 700 – and a debt-to-income (DTI) ratio preferably lower than 43%.
  • You are also more likely to be approved if you have a large amount of cash reserves.  It is not uncommon for a lender to ask for 6 months or 1 year of reserves to cover those mortgage payments.
  • You’ll probably need extensive documentation and sometimes, a second appraisal is needed to verify the value of a home.  Also, because jumbo mortgage loans are larger, expect to pay a larger down payment and closing costs.
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