If you are looking to buy a home in Texas and the loan amount is over $453,100, you are looking for Jumbo loan financing.
Your Grove Mortgage Jumbo Loan can be used to either purchase a home or to refinance your home current home from another lender. And whether you’re planning on living in the country or downtown, Grove Mortgage Home Loans will be by your side to help you with the home buying or home refinancing process.
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Jumbo Home Loans are simply Loans that are over the $453,100 conforming limit. They have a few different rules then regular FHA, Conventional or VA home loans.
A Jumbo Loan is a nonconforming loan with mortgage amounts higher than those set by Federal National Mortgage Association (FNMA, referred to as Fannie Mae) and Federal Home Loan Mortgage Corporation (FHLMC, referred to as Freddie Mac).
Although Jumbo home mortgages and conforming home mortgages have many similarities, there are some key differences to be aware of, including your credit score and credit history, debt-to-income ratio, the amount of down payment and cash reserves required by the lender.
Jumbo Loans are an option for homebuyers that are purchasing or refinancing their primary residence, second homes, vacation homes and investment properties. The financing is available in both fixed or adjustable rates mortgages.
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We offer purchasing and refinancing Jumbo home loan programs in Texas.
Each lender will set their own underwriting guidelines. Therefore, working with a Mortgage Broker is critical, we can shop different lenders, including wholesale lenders that borrowers usually don't have access to.
Jumbo loans are riskier than conforming loans for lenders because they are not insured by Fannie Mae or Freddie Mac, so if the borrower defaults, the lender is responsible for 100% of the loss.
Besides jumbo loans having stricter requirements and requireing more paperwork their rates and loan to value options are close to conforming loan rates and loan to values. Jumbo loans will usually have a higher closing cost than conforming loans also.
Many jumbo loan programs may not require private mortgage insurance for well qualified borrowers.
If you own a home in Texas, we offer Jumbo mortgage refinancing loans options including the Jumbo VA Streamline IRRRL refinance loans.
Refinance loans can be used to lower your current interest rate or help with many personal financial situations such as home improvements, reducing monthly payments, college tuition and more.
VA Jumbo Loans offer an unbeatable financing option for active duty or retired military in Texas. Just like the conforming VA home loans, the Texas Jumbo VA Loan doesn't require mortgage insurance either.
Jumbo VA Loans are also called a High Balance VA Loan.
Down payment requirements of a Texas Jumbo VA Loan. The differences between a VA Jumbo loan and a regular VA Loan is the amount of down payment required by the VA. There is $0 down payment up to $453,100 and for any amount over the $453,100, the borrower must put down 25% of the difference between $453,100 and the loan amount at closing.
Purchasing a $550,000 home: No money down on the first $453,100, and only 25% of the difference between $453,100 and the $550,000 (which is $96,900). So take 25% of the $96,900, which is $24,225.
In this example a Texas Veteran would have to put down $24,225 (only 4.40%) at closing, which is less than regular a Conventional Jumbo Loan.
If you currently have a Texas VA home loan with a balance over the $435,100, we can try to lower your current interest rate with the VA Streamline Refinance (IRRRL).
We shop many wholesale lenders, to get you the best financing.
The process for underwriting a Jumbo loan is stricter than a conforming home loan. They will require the same documents you provide with conforming but can also require a 2nd appraisal of the home from the lender.
Usually Loan amounts less than $1,500,000 require one full appraisal and loan amounts greater than $1,500,000 require two full appraisals.
Credit scores will need to be higher than non-jumbo loans. Usually a 680 will be the bare minimum for some programs and most of programs will require a minimum of a 720-credit score.
The lower the DTI (debt to income ratio), the better. The maximum DTI is usually at 50%.
Cash reserves for a Jumbo loan refers to the number of months of cash available after closing. Reserves are defined as PITIA (Principal, Interest, Taxes, Insurance and Association Dues) and are calculated off the new payment of the subject property.
If you have additional financed properties, other than the subject property the reserve requirement is usually increased. Assets used for reserves must be owned by the borrower.
The types of assets that may be used for reserves and the value of those funds are as follows: