Jumbo Loan Misconceptions
10. Jumbo loans are only for FAT cats?
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Actually everyone can use Jumbo loan products based on lender qualifications and loan size that is at least greater than $417K.
9. Jumbo loans are only for owner occupied purchases?
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No, Jumbo loans are available for owner occupied properties as well as investment and commercial properties, lot loans and construction loans.
8. But Jumbo loans require perfect credit, right?
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Less than perfect credit often is allowed on Jumbo loans such as with a 680 FICO on a 75% LTV up to $3M for an owner occupied purchase! Or a 680 FICO on a 70% LTV up to $2.5M for an investment property purchase.
7. Jumbo loans take forever to close, right?
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Actually only about 45 days as a general rule.
6. Don’t Jumbo loans require 30% down and I only have 10% down for my dream house?
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Many lenders now offer 10% down on loans up to $750K with no mortgage insurance!
5. But I need a larger loan up to $850K?
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15% down is allowed by some Jumbo lenders up to $850K….happy days are here again!
4. Jumbo underwriting is hard and a painful process, right?
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So is writing a $2M check to purchase a $2M house! But generally underwriting is really not very difficult for solid buyers.
3. But cash is KING, right?
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Aaah, but you’ll have more SWING keeping it for a FLING….(financial long-term investing opportunities) if you finance at least part of the purchase price.
2. But don’t Jumbo loans require large salaries to qualify?
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Some lenders have special Asset Depletion and Pledged Assets options for clients with significant assets so high salaries are not required to qualify for a loan.
1. Ok, but Jumbo rates are way too high, right?
- Actually Jumbo rates are often as good or even better than conforming rates!