Super Jumbo Loans
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What is a super jumbo loan?
A super jumbo loan, also known as a super jumbo mortgage, is very similar to jumbo mortgages. Here too, the loan amount does
not conform to the guideline limits set by government-sponsored enterprise (GSE). GSE’s are private financial services corporations (commonly known as Fannie Mae and Freddie Mac) created by the United States Congress to purchase home loans and guaranteed by the United States Government. Depending upon circumstances, any loan amounting to at least $1,000,000 is classified as a Super Jumbo loan.
Who generally benefits from a super jumbo loan?
Typically, it is valued between $1,000,000 to $5,000,000, but may even exceed that amount under certain special conditions.
This high-value mortgage is suitable for borrowers who are in the market for constructing or purchasing ultra-luxurious residential properties.
What are the eligibility criteria for obtaining a reverse loan?
Due to the large size of the loan, a super jumbo mortgage is usually not subject to the usual government regulations. Therefore,
the lenders have extremely strict requirements that need to be satisfied in order for them to approve a loan of this size. In order to get a super jumbo loan approved, the borrower is required to –
- Possess an excellent credit score of 700 or more
- Make a large down payment
- Have a lengthy and stable employment history with a consistent source of income.
Are there any other factors that determine the borrower’s eligibility?
Apart from maintaining a great credit score, the borrower is also expected to have no late payments in the last two to three
years in order to qualify for this kind of loan. Also, the Debt-to-Income (DTI) ratio plays a vital role in determining the eligibility of the borrower as lenders generally tend to favor a low DTI ratio of around 38% or less. However, there have also been cases where even a DTI ratio of 43% is eligible for super jumbo mortgages, provided the borrower possesses additional assets.
What about the down payment for a super jumbo loan?
The amount of down payment to be made depends on the lenders and the risk level they perceive; if the lender deems the loan
as risky, expect a larger down payment (many lenders can demand up to 50% of the loan amount as down payment).
What role does the property’s appraisal value play in determining the loan value?
Again, just like the lenders of jumbo mortgages, lenders of super jumbo loans may require not just one, but two appraisals of the value of the property. With regard to these types of mortgages, in many cases, the loan to value (LTV) ratio is a maximum of 80% of
the appraised value of the property (some lenders even offer up to 90% of LTV).
How are the rates of interest on a super jumbo loan?
The interest rates charged on super jumbo mortgages are almost always higher than the rates for jumbo mortgages by around one to
two percent, due to the increased lending risk involved. Although the types of super jumbo loans and the term of these mortgages are similar to jumbo mortgages, with both fixed-rate and adjustable rate mortgages on offer, ARMs are more popular with super jumbo mortgages due to the lower interest rates and the flexibility in payment amounts. Most lenders offer these mortgages on primary homes only, which effectively means that the borrower is required to utilize the home as his primary residence and has to live there. However there are some lenders who offer mortgages on second and vacation homes as well.
Is there a cap on the maximum amount that can be borrowed under a super jumbo loan?
Unlike traditional jumbo mortgages, super jumbo mortgages do not have any cap on the loan amount that can be accessed. These mortgage amounts can go up to $20,000,000 or even more; the limit set ultimately depends on the lender and his ability to finance the loan and bear the risks involved.
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We Work For You
We work for you, not the lender.
Because your financial situation is unique, your interest is better served if you’re not captive to a one size fits all mortgage offering. We represent a wide range of lenders so we can deliver to you the best loan at the best price for your particular circumstance.
Below are some of the types of loans available to you through our lender network.
Fannie & Freddie Eligible
The classic low cost home funding option. Available in both fixed and adjustable rate plans.
Ginnie Mae Eligible
The Federal Housing Administration (FHA), is a U.S. government agency that provides financing options that only require a minimum of a 3.5% down payment. FHA (203H) Disaster Loans however are eligible for 100% Financing.
Today, many homes require loans that exceed conforming loan limit amounts. Jumbo loans are a popular way to secure financing that exceed certain limits set by the Federal Housing Finance Agency (FHFA). Unlike conventional mortgages, a jumbo loan is not eligible to be purchased guaranteed or securitized by Fannie Mae or Freddie Mac.
The United States Veterans Administration (VA) provides up to 100% financing for homes as a benefit to veterans.
The U.S. Department of Agriculture’s (USDA) Rural Development Guaranteed Housing Loan program offer loans with up to 100% financing at rates below market and reduced mortgage insurance premiums with low credit score requirements.
A reverse mortgage or Home Equity Conversion Mortgage (HECM) is a type of home loan for older homeowners (62 years or older) that does not require the borrower to make monthly mortgage payments.
Private Equity Loans
Private Equity loans are based on the equity value of the property being put up for collateral and not necessarily on a borrower’s credit rating. This type of mortgage is a very useful for certain types of sophisticated borrowers such as those with multiple investment properties
Tam Funding is a licensed broker under the CA Dept. Real Estate: 02009074. Broker of Record NMLS : 1403204. Corporate NMLS: 1829222. CA Dept. Insurance: OL88065.
Borrower Conditional Approval is issued only when lender underwriting supplies a written clearance to do so. Borrower Conditional Approvals are conditional, not guaranteed and subject to lender review of all borrower information. The final funding of the loan is dependent upon all borrower conditions being met. Rates indicated are subject to market changes and may only be available to certain qualified borrowers. Tam Funding is an Equal Opportunity Real Estate, Mortgage & Insurance Broker
Equal Housing Lender
National Mortgage Licensing System