{"id":6126,"date":"2022-11-25T19:43:36","date_gmt":"2022-11-26T00:43:36","guid":{"rendered":"https:\/\/dreamhomefinancing.com\/?p=6126"},"modified":"2023-02-11T15:59:38","modified_gmt":"2023-02-11T20:59:38","slug":"5-down-jumbo-loan","status":"publish","type":"post","link":"https:\/\/dreamhomefinancing.com\/5-down-jumbo-loan\/","title":{"rendered":"5% Down Jumbo Loan Options"},"content":{"rendered":"<h2 style=\"text-align: center;\"><span style=\"color: #000000;\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-6127\" src=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2022\/11\/5-Down-Jumbo-Loan.jpg\" alt=\"5% Down Jumbo Loan\" width=\"660\" height=\"400\" srcset=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2022\/11\/5-Down-Jumbo-Loan.jpg 660w, https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2022\/11\/5-Down-Jumbo-Loan-300x182.jpg 300w\" sizes=\"(max-width: 660px) 100vw, 660px\" \/><\/span><\/h2>\n<h2 style=\"text-align: center;\"><span style=\"color: #000000;\">5% Down Jumbo Loan<\/span><\/h2>\n<p><span style=\"color: #000000;\">If you are buying an expensive home that is over the conforming loan limit, a 5% down jumbo loan option may be available to you.\u00a0<\/span><\/p>\n<p><span style=\"color: #000000;\">We have experienced a significant increase in home values over the past few years. The increase has pushed home prices into the jumbo loan range where the small down payment options such as FHA typically do not apply.\u00a0<\/span><\/p>\n<p><span style=\"color: #000000;\">Most lenders are requiring a larger down payment for jumbo loans which will make it difficult for some home buyers to qualify. Below are some options to consider if you really need a 5% down jumbo loan.<\/span><\/p>\n<h3><span style=\"color: #000000;\"><strong>What is a Jumbo Loan?<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\">A jumbo loan is a mortgage that exceeds the maximum conforming loan amount of $647,200. The conforming loan limit is set by the <a style=\"color: #000000;\" href=\"https:\/\/www.fhfa.gov\/Media\/PublicAffairs\/Pages\/FHFA-Announces-Conforming-Loan-Limits-for-2022.aspx\" target=\"_blank\" rel=\"noopener\">FHFA<\/a> at the end of November for the following year.\u00a0<\/span><\/p>\n<p><span style=\"color: #000000;\">If you are buying a home just over the conforming loan limit, you should consider waiting until the new limits are announced because the purchase price may fall within the new limits.<\/span><\/p>\n<h2><span style=\"color: #000000;\"><strong>5% Down Jumbo Loan Options<\/strong><\/span><\/h2>\n<p><span style=\"color: #000000;\">There are a few options to purchase a home using a jumbo loan with 5% down, or a combination of products to achieve the same 95% loan to value ratio.\u00a0<\/span><\/p>\n<p><span style=\"color: #000000;\">It is important to understand that the availability of these products is cyclical. Lenders offer solutions and then remove them when the market is unstable or if they do not have investors to fund the loans.\u00a0<\/span><\/p>\n<p><span style=\"color: #000000;\">The sweet spot for financing a home purchase with a low down payment jumbo loan is between the conforming loan limit and $1 million. If you are purchasing a multi million dollar luxury home, there are fewer options for a small down payment.<\/span><\/p>\n<p><iframe loading=\"lazy\" title=\"YouTube video player\" src=\"https:\/\/www.youtube.com\/embed\/w4r-UC37rbc\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/p>\n<h3><span style=\"color: #000000;\"><strong>Single Jumbo Loan with 5% down<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\">A single jumbo loan with 5% down is offered by just a few lenders and availability is based upon market conditions. There would be no PMI requirement, rates will be higher, and you will need to fully document your income.\u00a0<\/span><\/p>\n<p><span style=\"color: #000000;\">In some instances, this loan may be a 5 year adjustable rate mortgage versus a 30 year fixed.<\/span><\/p>\n<h3><span style=\"color: #000000;\"><strong>Conforming HELOC Combination<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\">Another way to get a 5% down jumbo loan effect is to combine a conforming loan plus a HELOC for a CLTV (combined loan to value ratio) of 95%. Your lender will provide you with a first loan equal to the maximum conforming loan amount. Then, a home equity line of credit or home equity loan for the balance of the loan.<\/span><\/p>\n<p>The HELOC is going to be an adjustable rate but doing this will enable you to pay down the HELOC faster.<\/p>\n<h3><span style=\"color: #000000;\"><strong>High Cost FHA Jumbo Loan<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\">Many home shoppers believe they need a jumbo loan but do not realize they live in a high cost area. In these locations, the FHA loan limit is extremely high in the million dollar range. This will enable you to purchase a home using what really is an <a href=\"https:\/\/fhalenders.com\/jumbo-fha-loans\/\" target=\"_blank\" rel=\"noopener\"><span style=\"color: #0000ff;\"><strong>jumbo sized FHA loan<\/strong><\/span><\/a> with only a 3.5% down payment.\u00a0<\/span><\/p>\n<p><span style=\"color: #000000;\">To qualify, you will need to fully document your income, have a two year work history and provide pay stubs and W2s.<\/span><\/p>\n<h2><span style=\"color: #000000;\"><strong><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-6274 aligncenter\" src=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2022\/11\/Jumbo-Loan-5-Down-300x182.webp\" alt=\"Jumbo Loan 5 Down\" width=\"300\" height=\"182\" srcset=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2022\/11\/Jumbo-Loan-5-Down-300x182.webp 300w, https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2022\/11\/Jumbo-Loan-5-Down.webp 660w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/strong><\/span><\/h2>\n<h2><span style=\"color: #000000;\"><strong>Qualifying for a 5% Down Jumbo Loan<\/strong><\/span><\/h2>\n<p><span style=\"color: #000000;\">You can expect the following as a requirement or feature for a 5% down jumbo loan:<\/span><\/p>\n<p><span style=\"color: #000000;\"><strong>Full Documentation<\/strong> \u2013 This loan option will require borrowers to qualify by fully documenting their income and providing tax returns.<\/span><\/p>\n<p><span style=\"color: #000000;\"><strong>Reserve requirements<\/strong> \u2013 There will be reserve requirements that each lender will set and will vary by lender. It is safe to assume you will need at least 6 months of payment reserves.<\/span><\/p>\n<p><span style=\"color: #000000;\"><strong>Credit Score Requirement<\/strong> \u2013 Lenders who offer a 5% down jumbo loan will likely require credit scores of at least 680 or more.<\/span><\/p>\n<p><span style=\"color: #000000;\"><strong>Debt to Income Ratio<\/strong> \u2013 The debt to income ratios allowed will be capped at about 43%. There are <a href=\"https:\/\/dreamhomefinancing.com\/high-dti-mortgage-lenders\/\"><span style=\"color: #0000ff;\"><strong>high DTI lenders<\/strong><\/span><\/a> who can help with your mortgage, but the down payment requirement will be higher.<\/span><\/p>\n<p><span style=\"color: #000000;\"><strong>No PMI<\/strong> \u2013 The loan options available will not require PMI which is another benefit.<\/span><\/p>\n<p><span style=\"color: #000000;\">If you are trying to purchase an expensive home with a 5% down jumbo loan, then <a href=\"https:\/\/dreamhomefinancing.com\/LeadForm.aspx\"><strong><span style=\"color: #0000ff;\">complete this short form<\/span><\/strong><\/a>\u00a0and someone will call to discuss your options.<\/span><\/p>\n<h3>95 Jumbo Loan No PMI<\/h3>\n<p>If you are looking for a 95 LTV jumbo loan with no PMI, you should consider a non-QM loan. With these mortgages, there is no PMI but finding a lender willing to allow just 5% down is the challenge. Keep in mind, the rate is often higher for these types of loans which may also offset the PMI.<\/p>\n<p>FHA loans will allow for the small down payment but PMI is required. In fact, you will have to keep it in place for the life of the loan.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-6279 size-full\" src=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2022\/11\/5-Down-Jumbo-Loan-Options.jpg\" alt=\"5% Down Jumbo Loan\" width=\"400\" height=\"600\" srcset=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2022\/11\/5-Down-Jumbo-Loan-Options.jpg 400w, https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2022\/11\/5-Down-Jumbo-Loan-Options-200x300.jpg 200w\" sizes=\"(max-width: 400px) 100vw, 400px\" \/><\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>5% Down Jumbo Loan If you are buying an expensive home that is over the conforming loan limit, a 5% down jumbo loan option may be available to you.\u00a0 We&#8230;<\/p>\n","protected":false},"author":1,"featured_media":6127,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_kadence_starter_templates_imported_post":false,"_kad_post_transparent":"default","_kad_post_title":"default","_kad_post_layout":"default","_kad_post_sidebar_id":"","_kad_post_content_style":"default","_kad_post_vertical_padding":"default","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"footnotes":""},"categories":[190],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/posts\/6126"}],"collection":[{"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/comments?post=6126"}],"version-history":[{"count":8,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/posts\/6126\/revisions"}],"predecessor-version":[{"id":6326,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/posts\/6126\/revisions\/6326"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/media\/6127"}],"wp:attachment":[{"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/media?parent=6126"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/categories?post=6126"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/tags?post=6126"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}