A Jumbo loan mortgage will be required if you are purchasing a Baton Rouge home with a loan amount of more than $510,400. Because these loans can’t be guaranteed by Fannie and Freddie, the lender is not protected from losses if a borrower defaults. These loans have stricter qualification rules.
Jumbo Loan Requirements
- Jumbo Loans require a higher credit score. Sometimes greater than 720.
- Debt to Income ratio has based on the lender’s minimum requirement. Some lenders have a hard stop at 45%.
- Cash reserves will be required. Sometimes the lender will require up to one year’s mortgage payments in reserves.
- Extensive financial documentation. It would help if you were prepared to hand over your full tax returns, W-2s and 1099s, in addition to bank statements and information on any investment accounts.
Jumbo Loan Details
Non-conforming loans will require a larger downpayment than a conventional loan. Typically, a lender will require 20%, although some lenders will only require 10%.
Rates may be a bit higher than a conforming load depending on the lender. It’s essential to shop around to compare rates.
Let us know if you need help finding a lender that can help you obtain a Jumbo loan. We are happy to make some introductions for you.