So after the last loan limit change by Fannie Mae coupled with housing prices in Denver, you may find yourself needing a Jumbo Mortgage in Colorado to buy a home. What does this mean to you?
To start let’s define what those loan limit changes were. So Fannie Mae, increased their loan limits to $424,350 for the majority of the metro counties. If you are buying in one of the outlying counties, let us know, we can check the loan limits for counties like Boulder, Summit, Routt and such. But once you exceed this amount on the first mortgage traditionally you need a jumbo mortgage in Colorado. There are work around options to a certain point, so ask about this potential for you.
Many people then want to keep their loan amount under the jumbo mortgage loan limit in Colorado for fear of higher interest rates. However, you may be surprised to learn that the interest rates on jumbo mortgages are as competitive, and in some instances, more so than a conventional loan amount would be.
So then what are the down payment requirements for that dream home? You could be looking at 10-20% down, and it really depends on the credit scores, and price point of the home you are buying. Once you get upwards of $1M-1.5M you can look at 15%, but after that expect to put 20% down, which you may be doing more than this for down payment.
Now getting strategic, you will want to talk about adjustable rate mortgages in the higher limit loans. It creates flexibility in cash flow. It allows you to minimize your financial outlay and keep your capital for other investments, endeavors, and business opportunities. One cool feature here is a recast option. This allows that if you make sizeable principal reduction payments you can have the principal and interest portion recalculated after. Again, creating more leverage with your mortgage, making your money work for you.
From a lender’s perspective, they are going to be looking for strong credit, and a clean credit history here. They will want assets (liquid), and conservative debt ratios. The kicker here, if by chance you are a Veteran, let us know, we can blow your mind with a little known fact about VA loans.
Should you have more questions feel free to dial me direct at 303-779-0591 x101