Looking to upgrade to a larger home? Jumbo loans are on the rise

Over the past year we have seen the inventory level of available homes on the market decrease and the demand for homes by potential buyers increase.  The law of supply and demand has definitely been positive for sellers and we have seen home prices rise as a result of it.  This sudden increase in property value has affected the type of mortgage loan that some potential buyers will obtain when financing a property.  In other words, as homes become more expensive buyers are now seeking a Jumbo loan for financing.

Jumbo loans start at $417,001 and typically require at least a 20% down payment.  If a purchase price exceeds $520,000 and a buyer is looking to put down 20% then they would most likely entertain a jumbo loan.  In some parts of South Florida we have seen homes that were once selling between $475,000 – $500,000 about 2 years ago that today are going for about $50,000 or more higher.  Once a home surpasses that $520,000 threshold then it may require a jumbo loan for financing if the buyer only has a down payment of 20%.  Of course if a buyer is putting down more than 20% then they could remain at a conventional loan size as long as they stay at or below $417,000.  Jumbo loans are gaining popularity because more and more lenders and banks are offering them to accommodate the increase in home prices.  Unlike a conventional loan, which is primarily sold to Fannie Mae or Freddie Mac and therefore must adhere to their guidelines, jumbo loans are not and sometimes remain with the bank or lender that is funding the loan.  As a result of a bank or lender keeping jumbo loans in their portfolio and not selling them off in a secondary market, we tend to find different guidelines when it comes to jumbo financing between various lenders.  Some may be more aggressive than others when qualifying a potential borrower.  For example, we have some investors that will allow a self-employed borrower to obtain a jumbo loan by using their last 12 months of business bank statements as income.  This is a great alternative for someone who may not report that much on their tax returns.  We also offer a 90% jumbo loan product with no mortgage insurance through our pledged asset program.  This is a program that allows you to pledge a portion of your assets without having to move or touch them so that you can put as little as 10% down when obtaining a jumbo loan.  

Jumbo loans do carry slightly higher interest rates than a conventional loan but with rates still at historic lows, they are a great solution for someone looking to upgrade to a larger home without having to break the bank to do so.  If you are looking to move to a larger home and are considering a jumbo loan, please give us a call and we would be happy to discuss your options and structure a loan that is best suited for you and your individual needs. 

To learn more about our company and mortgage products, please feel free to call Dan Longman, President of Priority Lending Corp, at 954-438-3776 ext.11 or email Please visit