What Is A Jumbo Loan?
A jumbo loan is a mortgage used to finance properties that are too expensive for a conventional conforming loan, also known as a loan that exceeds the conforming loan limits as set by Fannie Mae and Freddie Mac. As of 2023, the limit is $715,000 for a one-unit dwelling in most of the US, apart from Alaska and Hawaii, where the limit is $1,073,000. Interest rates may be a bit higher on jumbo loans because lenders generally have a higher risk. These loans require higher credit scores and larger down payments as well. While the process of getting a jumbo loan is not too different from other types of loans, given the nature of jumbo loans, each borrower should speak to a knowledgeable Mortgage Loan Originator about their options and the best strategy and loan type that will work for them.