Jumbo Loans-Phoenix
Living in Arizona can be an absolute joy. Millions of residents have fallen in love with this region, especially the city of Phoenix and the surrounding area. Owning your dream home in Phoenix could be the next major milestone in your life and the life of your family.
At District Lending, we understand that affording a home can be difficult, especially if you are facing a larger purchase price.
What is a Jumbo Loan?
When conventional loans that fall beneath the limit set by Fannie Mae and Freddie Mac are not enough to afford your Phoenix home, you will have to look for an alternative loan type. Any loan amount above those limits is considered a jumbo loan.
What do "Conforming" and "Conventional" Mean?
Conventional mortgages are not backed by the government, but there are two types of these loans; conforming and non-conforming. A conforming loan amount falls below the conforming loan limits set by Fannie Mae and Freddie Mac, unlike jumbo loans, which are above the conforming loan limit. These two organizations are regulated by the Federal Housing Finance Administration but are not a part of the government.
Defining Non-Conventional Loans
If you are moving into a home in Phoenix, a very competitive real estate market, chances are you may need to borrow a lot of money for the purchase. A conventional mortgage describes loans that are not backed by a government entity. Some examples of non-conventional loans include FHA and VA mortgage options since they are both backed by the government in some way. A jumbo loan falls under the conventional umbrella.
Non-Conforming and Conventional
Conventional non-conforming loans are those that exceed the figure of $726,200. Fannie Mae and Freddie Mac are not willing to back these "jumbo loans" because they are riskier due to the high amount of funds involved in the transaction.
Do You Qualify for a Jumbo Mortgage?
There are several considerations that most lenders take into account to determine whether or not you qualify for a jumbo loan amount.
Down Payment Requirement
A conventional loan typically requires at least a 3% down payment for a borrower to have a chance of qualifying. Jumbo loans have much higher down payment standards because of the higher risk and no backing from another entity. In Phoenix, you will likely have to cover a 20% down payment to have a shot at acquiring jumbo loan amounts. If you do not have enough liquid assets for sizable down payments, then jumbo loans in Arizona may be out of your reach.
Credit Score Minimum
Unreliable borrowers are a big no-no for lenders. If your credit score does not reflect a strong history of paying back your debts, then your application will be rejected by the majority of lenders. Residential mortgages that are under the maximum limit can be acquired with credit scores of 620 or more, but a jumbo mortgage will only be achievable with a credit score of 700 or above.
Low Debt-to-Income Ratio
Your debt-to-income ratio (DTI) is a percentage that reflects how much debt you have compared to your monthly income. The lower your DTI, the less risky of a borrower you are. A DTI of 50% or less is usually enough for most loans. However, jumbo loans might only be granted to those with a maximum DTI of 36%.
Learn More About Jumbo Loans From District Lending
Want to ask questions about our jumbo loan programs? Curious about what interest rates you might be eligible for with jumbo mortgages? Concerned about how multiple property appraisals may affect your single loan status? Worried that your income or credit scores may scare off lenders? You can rely on just one lender to know all the answers; District Lending.
We have helped thousands of borrowers in the Phoenix area figure out how to acquire jumbo loans so that their loan amounts are enough to cover larger purchases. Let’s work together to make a payment plan that works for you, whether it is a jumbo loan, an FHA loan, a VA loan, or a traditional mortgage.
While the stringent requirements may vary depending on the lenders you choose for your home loan needs, District Lending can help you secure the right mortgage with multiple loan programs. We make the jumbo loan process easy so that you can be a competitive buyer in the Phoenix market.
Securing Jumbo Mortgages Through District Lending
Free Quote
Whether you are on the hunt for single-family homes, investment properties, or a vacation home, jumbo loans give you the freedom to choose how you spend the capital. A free quote from District Lending can help you determine the loan amounts you can afford as well as the loan terms and interest rates. Borrowers should never make uninformed decisions, and our free quote will give you valuable insight into your mortgage needs.
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Fast Pre-Approval
Getting pre-approved for a jumbo loan can make you more competitive as a buyer. Sellers are more likely to hear your offer if you can move quickly on the purchase. Taking advantage of our quick pre-approval process if you qualify for a jumbo loan can get you closer to homeownership.
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Mortgage Calculator
Do you want a lender that gives you free access to tools that help you calculate your mortgage payment premiums? Would you like to compare the cost of a fixed-rate jumbo mortgage with an adjustable-rate jumbo loan? You can with our mortgage calculator. Play with the numbers to discover your jumbo loan limit and the loan amount you can afford based on interest rates, down payments, and other factors.
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