What The Heck Is A Jumbo Mortgage Loan

What The Heck Is A Jumbo Mortgage Loan



What the​ Heck is​ a​ Jumbo Mortgage Loan?
You may have heard of​ the​ term jumbo mortgage loan and wondered what it​ means .​
Well,​ in​ this short article I​ will take you​ through the​ meaning and why it​ is​ important for you​ to​ understand it .​
In basic terms,​ if​ a​ mortgage loan exceeds a​ certain amount,​ it​ is​ considered a​ jumbo mortgage loan .​
Currently (as of​ 2018),​ a​ jumbo mortgage loan is​ a​ loan more than $417,​000 .​
the​ limit typically changes each year .​
in​ 2018,​ the​ amount was $357,​650.
The great part about a​ jumbo mortgage loan is​ the​ approval process is​ the​ same for conventional loans for most lenders .​
Unfortunately,​ the​ interest rate for a​ jumbo mortgage loan is​ typically 1/4% higher than a​ conventional loan but this does vary and the​ difference seems to​ be less year after year.
Since brokers are typically compensated based on​ the​ amount of​ the​ loan and a​ jumbo mortgage loan is​ a​ larger amount than a​ conventional,​ you​ should feel comfortable negotiating the​ loan rate with your broker or​ lender .​
I​ am amazed that people will negotiate a​ $100 tire purchase but will fail to​ ask the​ broker compensation on​ a​ $1,​000,​000 loan .​
a​ good mortgage broker is​ happy to​ discuss fees and in​ most cases appreciates it .​
This way there are no surprises or​ concerns after escrow closes .​

Anytime you​ start the​ loan process whether refinancing or​ purchasing a​ home,​ I​ recommend the​ following steps:
1) Review current mortgage rates on​ the​ internet and get a​ feel for the​ current market .​
Interest rates change frequently so this step just gives you​ an​ idea .​
When looking over rates make sure you​ are reviewing jumbo mortgage loan rates as​ there is​ a​ rate difference.
2) Assess your loan needs and the​ amount you​ think you​ need
3) Ask family or​ friends for a​ reference of​ a​ mortgage broker
4) If you​ cannot find a​ referral,​ you​ should proceed cautiously and develop a​ list of​ questions for your prospective mortgage broker.
5) Questions you​ should ask include: how long have you​ been doing mortgage loans,​ are you​ full-time mortgage broker,​ how do you​ price your jumbo mortgage loans,​ and what education do you​ have .​
Asking these questions will give you​ a​ good first impression of​ the​ mortgage broker .​
6) Determine if​ you​ need to​ pre-qualify for a​ loan
7) Complete the​ loan application thoroughly and accurately
If you​ work with an​ experienced mortgage broker,​ the​ process will be very painless as​ the​ mortgage broker will anticipate problems and deal with them proactively.
If you​ follow the​ steps in​ this article,​ you​ are well on​ your way to​ getting a​ great jumbo mortgage loan and will build a​ long-term trusting relationship with a​ mortgage broker.




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