Jumbo Mortgage Loans

loan type: Jumbo Mortgages

jumbo loans are non-conforming loans
that do not meet terms and conditions set forth by Fannie Mae and Freddie Mac.

These two stock-holding companies purchase mortgage loans from lending institutions and secure them for resale to the investment community.
Fannie Mae and Freddie Mac establish maximum loan amounts, income requirements, down payment requirements, and type of suitable properties. Loans that do not conform to these guidelines are referred to as non-conforming loans.

view sample loan limits: http://www.fanniemae.com/

Jumbo Loans Have Higher Loan Balances

the loan balance for jumbo loans are above the maximum loan amounts established by Fannie Mae and Freddie Mac — thus jumbos are "non-conforming" loans.

Jumbo loans are used to buy large, expensive homes.

Jumbo Loans Have Higher Interest Rates

the interest rates on jumbo loans are generally higher than rates on conforming loan

The fixed rate can range anywhere from 0.11 to 0.77 points higher, depending on the region.

Adjustable rates are 0.01 points higher, but tend to narrow as the ARM adjusts.