FHA: Jumbo Loans
Maximum Amount to Borrow with FHA Loan
New FHA / HUD Guidelines will insure new increased loan amounts based on your county and state. That means you can take advantage of new maximum loan limits for FHA loans. Qualifying customers can now apply for an FHA Jumbo Loan up to the maximum allowed by FHA. You can apply for a home loan with 3.5% down under new FHA loan limits.
A sampling of FHA approved lenders show the following qualifying guidelines:
- Maximum Debt to Income Ratio's are 43%.
- Declining Markets: Two appraisals will be required when the loan amount, excluding upfront MIP, will exceed $417,000 and the LTV equal to or greater than 95%.
- Qualified borrowers pay for closing costs plus down payment covering the 3.5% statutory minimum.
- No non traditional credit.
- For greater loan amounts on purchases, minimum FICO scores increase to 600 on Purchase, Rate / Term refinances and to 640 on cash-out refinances.
- Standard FHA guidelines and regulations apply, yet many lenders do require a 580 FICO score.
- No down payment assistance on loan amounts over $417,000.
Qualifying With Liquid Assets
We allow for "asset depletion", whereby a formula is used to take a borrower's liquid assets to count as qualifying income. Additionally, we will even provide jumbo loans without documenting employment or income as long as a borrower has enough in the bank, stocks, and retirement accounts to cover the loan amount.
FHA Loan Limits Vary
FHA loan limits are not standardized across the nation-the homes in some housing markets cost more, others less. What constitutes an FHA Jumbo Loan amount in Hawaii may not be the same as what is considered typical in a less expensive housing market. FHA Jumbo Loan amounts will vary based on the by-zip code maximums permitted in that housing market. Talk to a loan officer about what is possible in your housing market, or the market where you want to explore purchasing a home.
FHA Jumbo Loans Versus Typical FHA Mortgage Loans
In many ways, FHA Jumbo Loans are similar to standard FHA mortgages, including the restriction on cash back to the borrower. Some want to know if it is possible to apply for an FHA Jumbo Loan that exceeds the value of the home, with the idea of taking the remainder of the mortgage loan out in cash at closing time.
Like regular mortgage loans guaranteed by the FHA, FHA Jumbo Loans are specifically designed to prevent cash back to the borrower at closing time except in the form of legitimate refunds, such as for items paid for up front but later included in the loan amount. Borrowers are entitled to that exact sum refunded to you at closing, but nothing additional.
In other words, when you are apply for an FHA Jumbo Loan, the “no cash back” rules would apply the same as a traditional FHA mortgage.
FICO Score Requirements and Loan Costs
FHA Jumbo loans have costs which may be higher than typical FHA mortgage loans, and depending on the participating FHA lender, jumbo loan FICO score minimum requirements may be higher. Borrowers who aren’t sure if their FICO score qualifies for an FHA Jumbo Loan should discuss specific lender requirements with a loan officer. You can also get pre-purchase counseling by calling the FHA directly at their toll free number (1-800 CALL FHA) and requesting a referral to a local, HUD approved housing counselor.
No Downpayment Assistance for Jumbo Loans
According to the FHA official site, no down payment assistance is permitted on FHA mortgages above $417,000. Jumbo Loan borrowers should plan on budgeting for the full down payment requirement for these non-conforming loans.
Helping More Jumbo Borrowers Qualify
Not all people meet the strict qualifying criteria for jumbo mortgages. We provide flexibility with a low minimum 5% down payment on our jumbo loans up to $2 million. Additionally, we offer jumbo mortgages with credit scores as low as 580 and allow for previous derogatory credit. In many cases, the net income shown on tax returns can prevent someone who is self-employed from being able to obtain a jumbo mortgage for a purchase or refinance. We allow deposits into personal or business bank statements to count as qualifying income, which could be the difference between being approved or declined.
FHA Jumbo Loans is available in the following areas/cities
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