Jumbo Loans: Financ Your Luxury Home

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Dreaming of a luxurious property or a home in a high-cost area? A jumbo loan might be your key to unlocking that door. Let's explore this unique mortgage option designed for high-cost properties above one million.

What is a Jumbo Loan?

A jumbo loan is a residential mortgage that exceeds the conforming loan limits set by the Federal Housing Finance Agency (FHFA). In 2025, this limit is $806,500 in most areas, but can go up to $1,209,750 in certain high-cost regions.

Here's a Quick Comparison of Jumbo vs. Conforming Loans

Feature Jumbo Conforming FHA
Income Capped No Yes1 No
Down Payment minimum 10% 3-5% 3.5-10%
Credit Score minimum 680 620 580
Loan Limit $10,000,000 $806,5002 $806,500
Mortgage Insurance No Yes Yes

1. The Conventional 97 product and HomeReady have maximum income limits which means you'd need 5-10% down payment.
2. The high balance conforming loan limit and FHA limits are higher and are designated by the govt. for specific counties and only in certain states.

Qualifying for a Jumbo Home Loan

Jumbo loans have stricter requirements compared to conventional mortgages:

- Credit score: 680 or higher
- Income verified by: Tax returns or alternative income documents
- Debt to Income Ratio: 43-50
- Down payment: 10%-30%
- Cash reserves: 6 to 12 months of mortgage payments

Home in affluent community

Your Options to Verify Income

The mortgage process for this jumbo loan includes key steps tailored to high-value property purchases. Borrowers typically begin with prequalification, where your lender reviews your credit score, income documents, and financial reserves. Since jumbo loans are not backed by government-sponsored entities like Fannie Mae or Freddie Mac, lenders perform an in-depth assessment of your financial health, including verifying your ability to meet higher monthly payments.

Additionally, jumbo loans offer flexible income verification options which makes them ideal for self-employed individuals and high-net-worth borrowers with diverse income streams. Whether you're providing traditional tax returns, 12-24 months of bank statements, or proof of qualifying liquid asset accounts, jumbo lenders can customize the process to fit your financial profile.

Jumbo Mortgage Down Payment Details

Look at the loan amount you need below, then your credit scores. On the right is your minimum down payment or equity required to refinance with the amount of cash reserves you'll need.

Your Loan Amount Your Credit Scores Your Minimum Down Payment PITI Reserves
Under $2 Million
Purchase or Refinance
740
720
680
660
10%
10%
10%
25%
6 months
6 months
9 months
9-12 months
$2M to $3 Million
Purchase or Refinance
740
720
680
660
10%
10%
20%
30%
9 months
9 months
12 months
12 months
$3M to $4 Million
Purchase or Refinance
740
720
680
660
20%
25%
30%
N/A
12 months
12 months
18 months
N/A
$4M to $5 Million
Purchase or Refinance
760
740
680
660
25%
25%
35%
N/A
18 months
18 months
18 months
N/A

Your maximum DTI is 50 for loans below $3 million. Over $3 million the maximum ranges from 43 to 48.
Your cash reserves may be in any personal account you own 100% or jointly with your spouse.

How to Get the Best Jumbo Loan Rate

To secure the best interest rate for your jumbo loan, start by improving your credit score. Lenders typically offer borrowers with a credit score of 740 or higher the best terms. If your score is lower, focus on paying down high-interest debt to 10% of their maximum limits or 30% if 10-percent is not obtainable right away. Also, correct any inaccuracies in your credit report.

William Cook, an NMLS licensed loan originator explains,
"I've prequalified many borrowers over the years and before we run their credit they tell me it's 760 or 800+. Then when we run it for "some borrowers" it's lower by 40 to 60 points. I review their credit to find out why and it's usually because their credit card balances are high relative to their maximum limit. They tell me they paid it off a couple weeks ago. The discrepancy is your creditors have updated your account balance when you log in but it can take them up to three weeks to update your balances with all 3 bureaus."

You have 3 solutions.

  1. Buy the rate down. This could be costly for jumbo loan amounts;
  2. Apply for a loan once 2½ to 3 weeks have passed and the major bureaus have updated your account(s) or confirm with your credit monitoring service.
  3. Do a rapid re-score with the lender. This usually costs $105 per bureau per credit card and is completed in 2-3 days. We can tell you which credit bureaus need to be raised.

Another key factor is your down payment. A larger down payment can lower your loan-to-value (LTV) ratio, which signals to lenders that you're less risky. Less risk means a lower interest rate. Consider making a 20% down payment or more to potentially secure a better rate.

Popular Jumbo Loan Lenders

Top Lenders Offering Jumbo Loans
Many large banks and mortgage brokers offer jumbo loans. Some of the top lenders include:

Banks typically have stricter qualifying requirements such as lower debt-to-income (DTI) ratios (often capped at 43-45%) and lower loan-to-value (LTV) ratios (usually around 70-80%) and tend to take 4 to 6 weeks to close. Mortgage brokers, on the other hand, can offer more flexibility with DTI ratios up to 50%, LTV up to 90, alternative income documentation, and close your loan in 2½ to 5 weeks. We use Rocket Wholesale for traditional jumbos to offer fast closings with competitive rates. This could be the difference in getting approved and closing on time.

Working through us you have numerous choices because we have access to over 75 different lenders with jumbo loan programs.
* If you own a home with lots of equity and want to buy another yet you don't qualify due to high DTI ratios consider a bridge loan


Tips to Close As Fast As Possible

The mortgage process for jumbo loans includes an appraisal report, sometimes two are required for loans over $2 million.

Frequently Asked Questions

Still have questions? Check these answers

  • What is the minimum credit score needed to qualify for a jumbo loan?

    To qualify for a jumbo loan, most lenders require a credit score of at least 680. However, for better interest rates and terms shoot for scores of 740 or higher

  • Can I qualify for a jumbo loan if I have a high debt-to-income (DTI) ratio?

    Qualifying for a jumbo loan with a high DTI is possible but it often requires compensating factors like substantial cash reserves, a higher down payment, or exceptional credit. Some non-traditional lenders offer programs specifically designed for borrowers with higher DTI ratios. A DTI over 50 is likley capped at 52 with compensating factors. Speak with a mortgage expert to understand your options.

  • How can self-employed borrowers qualify for a jumbo loan?

    Self-employed borrowers can qualify for a jumbo loan with the same credit score and reserves requirements. They may verify income by providing two years of personal and business tax returns, profit and loss statements, and bank statements to verify consistent income. An alternative through a mortgage broker with non-QM partners is to provide 12-24 months of bank statements, 2 years of profit & loss statements, or 1099's instead of tax returns.