Jumbo Loans: Financing for High-Value Homes
Jumbo loans, also known as nonconforming loans, are a unique lending option for high-value homes in Gig Harbor and nearby Washington neighborhoods. Jumbo loans are nonconforming conventional loans, which means they’re fully funded and insured through private companies and they exceed loan limits set by government-sponsored entities Fannie Mae and Freddie Mac. Debbie Mishko of American Pacific Mortgage works with top lenders across the country to offer fast funding solutions with great rates for jumbo mortgages. If you’re looking to purchase a high-value home in Gig Harbor or nearby Washington, Debbie Mishko is your local, experienced mortgage professional.
A Nonconforming Conventional Loan
To understand what a jumbo loan is, you’ll first need to understand what it is not. It’s a conventional loan because it’s not insured by a division of the federal government like a nonconventional loan is. Jumbo loans are also considered nonconforming loans because they exceed lending limits in a given county set by Fannie Mae and Freddie Mac. These government-sponsored entities purchase mortgages in bulk from private companies and turn them into securities. Jumbo loans aren’t purchased by GSEs, so they stay on private lenders’ books.
The following are the loan limits for Pierce County, where limits are higher than in most counties in the United States because of the higher median income. If a loan exceeds these limits, it’s considered jumbo.
- $667,000 for a one-unit property
- $853,900 for a two-unit property
- $1,032,150 for a three-unit property
- $1,282,700 for a four-unit property
Approval Requirements for Jumbo Loans
Lenders typically have more demanding approval requirements for jumbo loans than other types of loans. You should prepare to provide a 20-30% down payment. You also need to show you have a low debt-to-income (DTI), usually around 40% or lower, and have a good or better credit score (700 or higher is a good benchmark). Clients may need to provide up to two years of tax returns, proof of income and lines of credit.
Jumbo loans are available with fixed or variable interest rates and various loan terms. Jumbo loans have higher rates than nonconventional loans, in many cases. Debbie Mishko at American Pacific Mortgage is dedicated to finding the rate and term solution to fit your financial goals.
Your Home Financing Partner
Whether you’re a seasoned home buyer or purchasing your first property, it helps to have a skilled, local professional on your side. Debbie Mishko at American Pacific Mortgage will help you learn more about jumbo loans to determine if this or another financing solution makes the most sense for your lifestyle and your goals. If you live or are planning to purchase in Gig Harbor, WA, contact Debbie to schedule a consultation and to get a free quote.