Have you been interested in purchasing a property that perhaps comes with a higher price tag, and curious about the types of financing that are available for you to meet that goal?If your ideal home is located in a more expensive neighborhood or is priced at a substantial cost, you might want to consider applying for a jumbo loan. If you are looking into buying a deluxe property in the areas of West Palm Beach, St. Pierce, or Tampa Bay, Florida, CTC Mortgage is here to help. Continue reading to learn more about the different ways that a jumbo loan can help you.

How Does A Jumbo Loan Work?

Jumbo loans are considered a “non-conforming” loan, meaning that it surpasses the overall loan amount of a conventional loan. Fannie Mae and Freddie Mac, which are government-sponsored enterprises, (GSEs), establish the maximum loan limits of a conventional loan, which are currently set at $766,550 in most areas in the United States. In the event that a borrower needs more than that loan amount to buy a property, then a non-conforming jumbo loan will be required in order to help finance the home purchase. Jumbo loans are considered a higher risk mortgage for lenders since they are not guaranteed to be paid back if a borrower defaults on a loan, causing them to have strict lending requirements.

Benefits Of Obtaining A Jumbo Loan

If a borrower is able to meet the necessary requirements, there can be many advantages to obtaining a jumbo loan. Because a jumbo loan allows you to borrow a significant amount of funds, you have the opportunity to purchase a variety of types of housing, such as a luxury, higher-end property, an investment property, a vacation home, etc. Another benefit of a jumbo loan is that a borrower is usually not required to pay for private mortgage insurance, (PMI). You also may be able to qualify for competitive interest rates and you may be able to refinance a loan for an even better rate at a later date.

Eligibility Requirements For A Jumbo Loan

The typical lending requirements for obtaining a jumbo loan include:

• A 720 credit score or higher
• A low debt-to-income ratio, (DTI). A DTI of 43% or lower is optimal
• A minimum down payment of twenty percent
• A borrower could be responsible for paying for multiple home appraisals to determine the value of the home
• A borrower must provide the required paperwork for income, tax information, and assets verification, and demonstrate that they have the ability to pay back the loan.

Whether you’re looking for your dream house, you’re a real estate investor, or involved in the fix and flip market and want to use a jumbo loan in West Palm Beach, St. Pierce, or Tampa Bay, Florida, contact CTC Mortgage today for a consultation.

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