A jumbo loan is a home loan that is greater than the loan limit set by the Federal National Mortgage Association (also known as Fannie Mae) and the Federal Home Loan Mortgage Company (also known as Freddie Mac). Currently, the maximum value of a standard loan is $417,000 for a single home property; $533,850 for a two dwelling property; $645,300 for a three dwelling property; and $801,950 for a four unit property. Any single loan amount that exceeds those values will bump your loan into jumbo loan territory. Loans within the limits are referred to as conforming loans.
Because jumbo loans are not supported by the two listed Federal Mortgage agencies, they usually carry a higher interest rate. Other than the higher interest rate, jumbo loans are identical to a traditional, conforming loan. You can usually obtain a jumbo loan through the same channels as a conforming loan as well.
- Visit a local bank or credit union. Go into your local branch and ask to speak with a loan specialist. Explain the loan that you need and the loan specialist will walk you through the application process.
Contact your financial institution of choice by phone. Place a call to your business of choice and ask to speak with a loan officer. Many financial institutions will begin the loan process over the phone and either send you the paperwork by mail or have you come into a local office to sign the documents.
Apply to a specific institution through the Internet. In the interest of reaching more customers and increasing their efficiency, nearly all major financial institutions will now take your application online. Visit the site of your financial institution of choice and follow the instructions to apply for a loan.
Using a broker online. If you utilize a search engine such as Google, you can search for a jumbo loan. There are a number of sites available that will allow you to enter your information and details on the loan you are requesting for a number of brokers to review. You will then be contacted by the brokers who will offer you their best deals. One such site is Mortgage X, where lenders will compete for your business.
As with any major purchase or large loan, make sure that you have reviewed the terms and conditions of the contract before you sign. If you are unclear or uncomfortable with any of the terms, discuss them with your financial institution immediately.