Jumbo Loan Down Payment Guide

Jumbo Loan Down Payment Guide

Jumbo Loan Down Payment Guide

The place is incredible. It’s the house of your dreams. You gaze at it from the road and imagine driving up the driveway at the end of a tough day and all your stress just melts away.


The loan that you would need to be able to buy that house is more than a conforming loan limit. Your finances are strong. The issue is only that the value of the home, as compared to your jumbo loan down payment, leaves more than the allowable limit.

The 2018 limit for conforming loans is now $453,100 in most every part of the country. In some high-cost areas the limit is higher, at $721,000. If you need a loan for more than a conforming limit in the area, a jumbo loan might be in order. The down payment for jumbo loans is often a question in people’s minds.

Jumbo Loan – Definition

What makes jumbo loans are their size. They are used to purchase a home that is priced higher than others in the general area. In order to qualify for a jumbo loan, you will have a low debt to income ratio, a high credit score, and some substantial cash reserves. The down payment on jumbo loans is calculated the same way as on conforming loans. The down payment on jumbo loans can be a lower percentage of the value of the house than typical conforming loans.

Non-Conforming Loan – Definition

The term non-conforming is used to explain that the loan does not follow the limits set by the Freddie Mac or Fannie Mae standards. A jumbo loan down payment is not sufficient to bring the loan amount below the conforming limits.

Who Makes Jumbo Loan Down Payment Underwriting Guidelines

Each lender is able to write their own guidelines for their own jumbo loans. That means eligibility requirements for jumbo loan down payments tend to vary from lender to lender.

The Differences Between a Conforming Loan and a Jumbo Loan

The biggest differences between a conforming loan and a jumbo loan are the size of the loan, the value of the property, the down payment requirements and the interest rates.

The Down Payment for Your Jumbo Loan

Jumbo loan down payment requirements vary from lender to lender, but the standard 20% is still the most common. There are many opportunities for just a 10% to 15% jumbo loan down payment, but some other lenders are stricter, asking for up to 30% in some situations.

Jumbo Loan 10 Down

Smaller jumbo loan down payments are offered to some home buyers in strong financial positions. Sometimes a 10% jumbo loan down payment is an option, but can be offset by a slightly higher interest rate.

Interest Rate

Interest rates used to be higher for jumbo loans. Recently, the interest rates on jumbo loans have come down so they are often about the same, or even slightly better than some conforming loans.

It is possible to purchase that dream home. With a jumbo loan it is not out of reach.

If you have questions about a jumbo loan down payment, contact us for more information.