Jumbo Loan Interest Rates

Ideal for high earners seeking higher loan limits >>

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Overview

A Jumbo loan is a non-conforming conventional mortgage that exceeds the limits set by the Federal Housing Finance Agency (FHFA) for Fannie Mae and Freddie Mac (ranges from $548,250 to $822,250). Because Jumbo loans are not insured or guaranteed by a government agency and cover larger purchase prices, requirements are stricter (the lender is assuming additional risk). The financial review is more rigorous. Jumbo loans may be used to purchase or refinance (including a cash-out refinance). Jumbo loan interest rates may be either fixed or adjustable, with various loan terms including 10, 15, 20, or 30-year terms.

Reading Time

5 mins | EMAIL US with questions

Features vs. Conventional

  • Higher Interest Rates
  • Larger Down Payment Requirements
  • Larger Loan Amounts

Potentially Also

  • No mortgage insurance¹
  • “Second opinion” appraisal²

Topics Below

I. Eligibility Requirements
II. Key Factors | Interest Rates
III. Specialized Uses
IV. Our Approach
V. FAQs

I. Eligibility Requirements³

Provided for informational purposes only and subject to change. These represent common eligibility requirements for Jumbo loans across the mortgage industry. Strong Home Mortgage eligibility requirements may differ. Contact a loan officer to discuss.

  • Debt-to-Income (DTI) ratio of 43% or less.
  • Minimum FICO® score of 700 (lower scores possible in certain instances).
  • Liquid assets and cash reserves equal to 6-12 months of mortgage.
  • Sufficient capital to cover closing costs
  • Extensive documentation (tax forms, investment detailing, etc.)
  • Minimum of 10% down payment.
  • Standard plus “second opinion” appraisal may be requested.

II. Key Factors | Interest Rates

Jumbo loan interest rates are set by the lender and follow Federal Reserve benchmarks. Some factors that may affect your interest rate include:

  • Down Payment Amount
  • Liquidity of Cash Reserves
  • Loan Purpose (e.g. purchase, refinance)
  • Loan Duration (e.g. 30 year vs 15 year)
  • Credit Score
  • Previous Loan Repayment History
  • Current Market Condition

Concerned about qualifying with your credit score? Let’s schedule a call.

III. Specialized Uses

  • Utilize as a “house hacking” solution to pursue a more expansive, owner-occupied duplex, triplex, quad, or multifamily dwelling (with four or fewer units). The strategy requires you to live in one of the units while renting out the others to cover the mortgage, generate positive cash flow, accelerate wealth accumulation, and attain greater financial freedom.
  • Acquire a bigger home on a larger plot of land in rural or suburban areas (popular with remote workers).
  • Gain access to higher-priced homes or luxury townhomes in resort-style communities with upscale amenities without having to bring enough cash to the table at closing to meet conforming loan limits set by Fannie Mae and Freddie Mac.

IV. Our Approach

Jumbo loan interest rates, like other mortgage aspects, have many moving parts. Each borrower is unique. Your loan officer becomes your single point-of-contact to ensure clear, timely, and tailored communication. We often close loans in less than 30 days, beating the gold standard for well-qualified customers. We answer questions, promote understanding, clear hurdles, and hustle to deliver your loan sooner.

V. FAQs

Because Jumbo loans are a type of conventional loan, many of the conventional loan FAQs are relevant. For questions about Jumbo loan interest rates, check the “Key Factors” section above or contact your loan officer to discuss further.

What’s the difference between interest rate and APR?

An interest rate is what you pay each year to borrow money. It doesn’t reflect any fees incurred. The APR, or annual percentage rate, reflects a broader borrowing cost. It includes Jumbo loan interest rates plus any fees tied to obtaining the loan such as origination fees. APR is one measure you can use to compare mortgage offers.

Are Jumbo loan interest rates lower?

Depending on the rate environment, Jumbo loan interest rates may be at least 0.25% higher than rates for a conventional conforming loan. Recently, rates for Jumbo loans have been close to rates for conforming loans.

Ready to explore your Jumbo loan options?

By using this website, you agree to these Terms of Use.  All content provided is for informational purposes only and subject to change.  Contact a loan officer to discuss your personal situation.  Strong Home Mortgage does not offer goods or services to residents located in New York, Georgia, Nevada, or Missouri.

¹PMI may not be required with a loan-to-value ratio of at least 80%.
²Jumbo loans often involve large or unique properties that may be difficult to appraise when weighed against neighboring comparisons. This may result in increased appraisal fees.
³Additional requirements apply. Eligibility subject to final underwriting approval. This is not a commitment to lend.

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