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Jumbo


Maryland Jumbo Mortgage

Maryland Jumbo Mortgage - Learning Center.

A Jumbo mortgage is a home loan that exceeds the standard loan limits set by the Federal Housing Finance Agency's limits. A home must meet a VA appraisal guidelines and the veteran must also credit and income qualify.
See your Jumbo home loan purchase options.
See your Jumbo home loan refinance options.

Understanding a Maryland Jumbo Home Loan.

Understanding your income when getting a Maryland Jumbo home loan:
Borrowers should have an established income for two years. If job change has occurred recently then the current employment information and the previous employment information should be provided. It is usually best if the new employment is in a similar profession as the previous employment. Also there should be little lag time between both employments. Two months worth of pay stubs should be saved prior to applying for the loan. The VA borrower should also have the previous two year's of W2's. If self employed then 1099 and a Profit and Loss statement from an accountant is recommend to help prove income.

Understanding your reserves when using a Maryland Jumbo home loan:
It is standard to have a minimum of two months of reserves. Larger amounts of reserves will assist in the approval process. If required, a standard reserve is a minimum of two months of the purposed PITI (Principle-Interest-Taxes-Insurance) and any HOA or Condo fees. Meaning, this should be accessible cash and it should be ‘seasoned’ in some form. Seasoning means it should not be cash, it should have been in checking, savings or other traceable accounts like 401k and money markets.

Understanding your credit when using a Jumbo home loan:
 Regularly, two years of credit history is recommended with 3 open and active credit lines in good standing. Credit scoring is used in determining credit approval.Although there is no minimum score set is the automated underwriting system accepts the loan a score of 680 or better would be recommended and scores over 720 are considered excellent.

Understanding the property requirement when using a Jumbo home loan:

The property must be appraised by an approved appraiser and meet the lender's requirements (Usually similar to Fannie MAE or Freddie Mac). The loan limits vary dependent on the property locations and lenders guidlines.

Understanding a Maryland Jumbo home loan.

What loan amounts are Jumbo Mortgages an Super Jumbo Mortgages?

1. In general, a standard Jumbo loan is typically a loan greater than $517,500 - these numbers may vary by state/county/city. Each property location may offer different guidelines.

2. A Super Jumbo Mortgage Loan is loan amount that exceeds the lender's jumbo loan limit. These no-conforming loans are usually a portfolio product and not a standard lending product.

Jumbo loan rates tend to be higher than conventional home loans. In addition, it is recommended that a borrower using a jumbo loan has 3 times or more assets in reserve compared to a standard loan.

Jumbo rates vary but typically you can assume that a jumbo mortgage rate will tend to be about .25 to 1 percent higher than a standard mortgage. In addition, the loan product tends to be a ARM mortgage. Fixed rate jumbos may be available but the rate will be higher adjusted for the risk.

In some situations, it may be better to use a standard conventional first mortgage and get a second mortgage for the amount that exceeded the conventional loan limit.

Example
Using a conforming product 80/15/5 to avoid the  jumbo mortgage rates.

Jumbo loans exceed the conforming loan limit. However, in order to avoid the higher rate on a jumbo some buyers use a conforming first mortgage (80% of the purchase price or up-to the maximum conforming limit) and then a second mortgage (15% of the amount over the conforming limit) to make up the difference over the conforming loan limit. The remainder (5%) is the borrowers down payment.

Jumbos usually are an Interest Only arm. With this loan it is crucial that a borrower understands their full loan payment before deciding to utilize this option. The payment can vary greatly at adjustments and there is a possibility of “Payment Shock” when that adjustment occurs. So be sure to understand the margin and index for the time when the loan will adjust.  You will need to meet the specific income, credit and assets requirements..

Common documents needed when utilizing a Maryland Jumbo Mortgage loan.

Original pay stubs for the previous month - but you should save at least the last 3 months.
Copies of your W2 for the last 2 years - be sure you have them for all borrowers on the loan.
For refinances - Copy of homeowners insurance - if you use a specific agent you should have their contact information available for the lender.
Copies of asset information - such as proof of money for closing costs  (if needed), 3 months worth of statements from your savings & checking accounts and investment records for mutual funds, stocks, bonds or other liquid investments.

Here are some simple steps to follow for Maryland Jumbo mortgage shoppers:

  1. Gather the necessary documents (listed above  ‘Common Documents’)
  2. Search out the Maryland conventional/jumbo loan limits in your area. If your loan amount exceeds these limits, you may need a jumbo loan.
  3. Now you are ready to get your VA buyer advice direct from a loan officer. Request a Maryland jumbo loan purchase rate quote or a Maryland jumbo refinance quote.

Maryland 2017 Conventional Home loan limits by Maryland Counties and Cities.
If your loan exceeds these limits you may require a Jumbo mortgage.

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