10% Down Payment on Jumbo Loanmylenderjackie
Is a 90% loan to value jumbo loan right for you? If you are in the market for a home that runs on the higher side or over the standard amount, a traditional loan might not be the best option. In this case, a jumbo loan is really what you want.
Jumbo loans don’t fall into the same categories that most Fannie Mae and Freddie Mac loans require. They are a monster all of their own. These loans are a higher value than most so the requirements and qualifications are also higher. Usually, only those with higher credit scores and strong finances can qualify for a jumbo loan and the cost associated with a jumbo loan can also be big. But, does that mean that you have to have a 50% down payment? Not anymore.
Jumbo loans can get you the home of your dreams and there are several options for a 90% loan to value jumbo loan, but not everyone can offer this. This is actually a rare type of loan that only certain qualified lenders have the ability to offer. This loan-to-value option, meaning that the ratio of a loan to the value of the home purchased would be a 90%, allows for 10% down payment and even eliminates the need for mortgage insurance.
So how does it work?
There are several different options. You can go with a piggyback financing which offers available purchase price up to $1.9 million. The first mortgage is usually a fixed rate loan while the second mortgage carries the additional 10% or more. You can also get a single loan with no private mortgage insurance up to $2.2 million for a 30 year fixed rate mortgage. Aside option could be in REX homebuyer program which is more of a down payment funding instead of the loan. REX matches your 10% down payment so the total is actually 20% and then you pay back the agreement with the percentage of the value change of the home.
Are there any negatives to this type of loan?
There are not a lot of negatives to this type of loan but you do need a higher credit score and a good financial standing. These mortgages are not just for buying extravagant homes because many homes in certain areas naturally run over a half million dollars. This puts these home loans out of an FHA, Fannie Mae or Freddie Mac option so homeowners have to go with a jumbo loan just before the median home price.
If you’re looking to buy a home over the median price or your home price just doesn’t fit into any other loan, a 10% down jumbo loan might be ideal. Give me a call; let’s figure out the numbers and see if this works for your needs, budget and financial situation.