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Jumbo Mortgage

When people want a home mortgage, they either contact their local bank or loan office, but what if you are one of those people that wants a really big house?  There are several things you can do to get financing, but chances are in order to get a loan, you are looking at jumbo mortgage financing options.  Let's go over what constitutes a jumbo mortgage and why they are needed. 

The first thing to understand is that most investors have set a cap on their lenders as far as what they can lend out at the prime rate.  The amount currently hovers near $417,000 dollars in the USA.  This means that if you have a loan amount that is less than this, you can get the conventional loans that require 10-20% down at the most prime rates available.  If you need financing for over $417,000 dollars, you will instantly be placed in the jumbo mortgage category.  Each lender differs on their jumbo guidelines, so it is very important to do your research as the amount of lenders offering jumbo loans has decreased significantly over the years. 

Jumbo mortgages can be obtained through purchasing, or mortgage refinancing. Back in the day, there were several jumbo bad credit mortgage programs, but now these programs have all but disappeared. In order to obtain a jumbo mortgage, one must have plenty of assets, proof of assets, and seasoned money to be able to be considered. Since each lender differs from each other on guidelines, it is very important to find out what each lender requires in the way of paperwork and down payment in order to secure a loan. By finding this out, you will easily be able to see which lender will work best with you credentials and current situation. 

Jumbo mortgages often have higher interest rates as it increases the risk for lenders to be able to lend out large sums of money.  The more money you have to put down, the better off you will be as the rate can usually be lowered greatly if the borrower is willing to put a lot of money down.  Jumbo financing can be done in fixed type mortgages, or you can get adjustable rate mortgages.  Getting a mortgage refinance on one of these types of loans can be difficult in today's market as most larger homes have dropped quite a bit in price via market value.  Because of this, it is always a good idea to put down as much money as possible to keep the mortgage payment low so that it is affordable. 

 

  10 Steps to Home Ownership:

Step 1: Are You Ready?

Step 2: Hire a Realtor

Step 3: Get Loan Pre-approval

Step 4: Search for Homes

Step 5: Choose a Home

Step 6: Obtain a mortgage

Step 7: Make an Offer

Step 8: Insure Your Home

Step 9: Close the Deal

Step 10: Avoid Foreclosure

 

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