About our Jumbo Loan Programs
Residents in Arizona have some great Jumbo mortgage options now available up to 95% LTV (loan to value). The one major difference between Jumbo loans and standard conventional mortgages is a Jumbo Loan is provided only for higher cost properties over the conforming loan limit. Most Arizona locations like Scottsdale and Phoenix characterize “Jumbo mortgages” for any amount that exceeds $484,350.
- No mortgage insurance
- Very competitive rates
- 45% Debt-to-income ratio limit
- Primary Residence Only
- Jumbo with 10% down
- Loan Amounts up to $850,000
- 740 Fico Score Required.
The Right Lender
Jumbo loans in Arizona might be the only feasible option available for the borrower living in a high-cost area. It is important that you choose a reliable mortgage lender who can educate you on what will be the right loan option for you. Someone that understands the complex financials of high net worth borrowers.
Jumbo Loan FAQs
When Should I Consider a Jumbo Loan?
Jumbo loans are typically used to finance properties that are too costly for conventional conforming loans. The maximum conforming loan amounts for each state are determined by Federal Housing Finance Agency (FHFA). As of January 1, 2021, Arizona’s maximum conforming loans were pegged at $548,250 for single-family 1 unit homes. If your home exceeds this limit, you may require a jumbo loan to finance the purchase.
What Are the Qualifying Criteria for a Jumbo Loan?
The underwriting procedure for jumbo loans is more stringent than conventional loans, as these loans are much larger and riskier for the lenders. Some of the requirements that most lenders use for the jumbo loans include:
- Credit score: You may need a FICO score of 700 and higher to qualify for a jumbo loan
- Debt to income ratio: Lenders may also take into account your debt to income ratio (DTI) to ascertain that you aren’t over-leveraged. Some Jumbo loan lenders have a hard cap of 45 percent. However, they can be flexible if you have plenty of cash reserves.
- Cash reserve: Getting approved for a jumbo loan may be a lot easier if you have adequate cash reserves in the bank. Most lenders ask borrowers for cash reserves that cover one year of mortgage payments.
- Documentation: Jumbo loans typically need an array of documents that prove your financial health. In addition to bank statements, you may need to provide your full tax returns, 1099s and W-2s, when applying. You may also need to provide information on any investment accounts that you hold.
- Appraisals: Some lenders may also ask for a second home appraisal for the property you plan to acquire.
Do You Have to Put 20 Percent down on a Jumbo Loan?
Like all other mortgages, Jumbo loans have some down payment requirements. It is not unusual for lenders to demand 20 percent down on jumbo loans for single-family units. Second homes and multifamily units may need even higher down payments. However, as a general rule, be prepared to make a down of between 10 percent and 30 percent depending on the lender. While 20 percent down is an excellent benchmark, it is always advisable to talk to your lender about the available options.
Does Arizona Have High Balance Loan Limits?
Currently, the state of Arizona doesn’t have any county considered high cost or competitive areas. The conforming loans limit for the entire state is presently $548,250.
What Are the Benefits of a Jumbo Mortgage?
The advantages of a jumbo loan are many? These include:
More money: The reason why jumbo loans are referred to as non-conforming loans is that the loan amounts surpass the limits of conventional mortgage loans as set by Fannie Mae and Freddie Mac. The foremost benefit of a jumbo loan is that lenders get more loan money to purchases high-value, high-quality property that would otherwise be unaffordable with conventional loans.
Low down payments: Unlike most conventional loans, jumbo loans require lower down payments. Most traditional loans require a 20 percent down minimum. Jumbo loans down can be as low as 10 percent.
Competitive interest rates: Jumbo loan interest rates have declined in recent times. Some lenders offer lower rates than a borrower will find with a conventional mortgage.
Flexibility: Jumbo loans are available in different varieties. Borrowers typically have more leeway to choose a mortgage that works best for them. You can either go for a 30-year fixed-rate jumbo loan or opt for an adjustable-rate mortgage instead.
How Do I Boost My Chances of Approval with a Jumbo Loan?
Getting a jumbo loan needs not be as difficult as it sounds. With a little creativity on your side, getting the loan is highly doable. Some of the steps to take include:
- Check with multiple jumbo loan lenders to get multiple interest rate offers
- Check your credit score and boost it where you can
- Get all your personal financial documents in order
- Be prepared to demonstrate ample cash reserve
- Have your target home appraised.
Keep these guidelines in mind to determine whether a jumbo loan is right for you.