For a loan to be considered a “jumbo” mortgage, the loan amount must exceed conventional conforming loan limits, which are set by two government-sponsored enterprises – Fannie Mae and Freddie Mac. These two corporations set the limit on the maximum value of any individual mortgage they will purchase from a lender. Currently, the conforming loan limit is $417,000 for a one-unit home – meaning, if you need to borrower half a million dollars to buy a million-dollar home, you would need a jumbo mortgage.
In some cases, there are loan products that have elevated conforming loan limits, which give borrowers the ability to obtain mortgages exceeding the normal $417,000. The availability of these loans varies by county. The U.S. Housing Department has a useful tool on their website where you can find limits in each state/county.
For further information on jumbo loans, please contact us. Our mortgage professionals will review your loan options and help you figure out whether a jumbo loan is right for you.