Here in Denver, the question has been more and more relevant. With rising home prices, many people are faced with needing a jumbo mortgage to buy their dream home. But it is not really clear, so let’s see what we can do to explain what is a jumbo mortgage.
It all starts with understanding loans have limits when you are talking average loan sizes in America. Right now the national loan limit is $453,100, which is up from last year. Past that there are cities that are considered high-cost areas. You guessed it, Denver fits right into that mold. So in those cities loan limits can exceed the $453,100 loan amount. Here in the metro area, the loan limit is $529,000 for homes. Now you ask, what is a jumbo mortgage? So if you borrower over $529,000 in the Denver Metro area you are needing a jumbo mortgage. There you have it. What is a jumbo mortgage? It is when your first mortgage balance starts at over $529,000 in balance.
From there, you get into what is a jumbo mortgage down payment. This is where it gets murky folks. You see there are numerous ways to finance homes. So to avoid confusion about combo loans, and so on, I am just going to explain what is a jumbo mortgage down payment. If you have questions about if you need a jumbo mortgage for your home purchase, let us know!
On the standard, jumbo mortgages require a 20% down payment¹. This is where the best rates live on those jumbo mortgages. From there, options exist all the way down to 5% down¹, and in some cases putting <20% down on a jumbo mortgage does not require private mortgage insurance (PMI). Often times you will even find that the jumbo mortgage 30 year fixed rate may be in line with that of the conforming ($453,100) loan limit rates. Bear in mind, high balance ($453,100-$529,000) do have higher interest rates (that is a whole different blog).
To better discern how you can go about structuring your home purchase on a higher end home, give us a call to talk structure and strategy. After all, if you are buying a high-end home you’ll definitely want to align with a professional who can put you into a mortgage that is structured to suit your personal needs. Give us a call 303-779-0591
Ray Williams-NMLS #216267/ Branch Manager / Mortgage Maestro Group / x101