Who this is for
- Buyers in high-cost markets or of higher-priced homes.
- Borrowers with strong credit, usually 700 or higher.
- Buyers with 10% to 20% or more to put down, plus cash reserves after closing.
How it works, step by step
- Find this year's conforming limit for your county. Above it, you need a jumbo loan.
- Expect a fuller paperwork review, and often two appraisals on large loans.
- Compare jumbo lenders directly. Banks and credit unions can beat the big online lenders here.
- Ask about relationship pricing. Some lenders lower your rate if you move deposits or investments to them.
Pros
- You can finance a home above the conforming limit in one loan.
- Jumbo rates are sometimes at or below conforming rates for borrowers with strong credit.
- No mortgage insurance at many lenders, even under 20% down.
Cons
- Stricter rules on credit, reserves, and paperwork.
- Pricing varies widely from lender to lender.
- Fewer refinance options later if the market tightens.