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Jumbo mortgages

1,370 Views | 3 Replies | Last: 7 yr ago by texrover91
tmas
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AG
What should I know about jumbo mortgages? I have had several conventional mortgages, but looking to cross the home value threshold that would require a jumbo.

Are there any differences in application?
Are there any prefer lenders?
Anything else I should know or be aware of?

Thanks!
texrover91
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AG
jja, Bott, and Jay Hurst will probably be your best sources on the board, but, my experience:

Generally, there aren't as many products or lenders for Jumbos - but that's slowly improving. Expect higher rates, but, some of the brokers might have better rate options. Credit scores will generally have higher minimums.

Some secondary lenders don't do jumbo - but I've seen some who will go so far as an in-house portfolio loan for borrowers with lower scores (higher rates but the borrower is expected to move to a traditional seconday market mortgage within say 12-24 months). One of our wholesalers just added a jumbo product this week so the market is growing.


How big a jumbo?

Some lenders have pushed the minimum loan size up slightly to be categorized as a "jumbo"

You might also see some market specific limitations

When you hit the $1,000,000 appraised value is when it gets a little "stickier" with some lenders - closing can take longer as they likely will require two appraisals. I've had what started as a supposed 18-20 day home equity loan suddenly become 45-60 days due to underwriting and appraisal requirements. So jumbos can cost a little more, you may have to pay for an additional appraisal.

As far as Home Equity side - lenders may limit home equity / cash out due to size if you are $1M+, some won't have a cash out option at all.

Side note on home equity if you think you'll need it down the road:

We went with a securities based line of credit for our home renovations and we'll refinance when completed (or just pay down and keep it or pay off entirely). We got a sub 3% rate. We didn't want to wait since we'd be bumping the $1M mark and new baby on the way and needed to start construction, and we didn't care for the HE limit. And of course once a cash out always a cash out so we avoided that.



jja79
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tmas I'm with Amegy Bank and I'd welcome the opportunity to discuss jumbo financing with uou. Email on profile.

texrover I assume you're going to refi the securities based lined and secure it with the home. Won't that be cash out?. Just as a point of information we offer residential construction/major renovation financing with rates in the 3's and below.
tmas
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email sent
texrover91
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Not sure yet jja - but yes, if we did refi and cash out to repay you're correct.

With my wife pregnant when we started I couldn't pin down the scope and total cost (still can't LOL) which made me wary of going home equity up front. This way we could start and fund as needed (no draws or inspections).

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