Jumbo loans exceed the conforming loan limits set by Fannie Mae and Freddie Mac. In 2026 the conforming limit is 66,550 in most areas and higher in high-cost areas.
Jumbo loans have stricter requirements: typically 700+ credit score, 10-20% down payment, 6-12 months mortgage reserves, and DTI below 43%.
Rates on jumbo loans are typically 0.25-0.5% higher than conforming loans though the gap has narrowed in recent years.
Credit Requirements
Minimum credit score of 700 is typical though some lenders accept 680+ with compensating factors. Higher scores (740+) get the best rates. Credit history should show no recent late payments or collections.
Down Payment
Minimum down payment: 10-20% depending on lender and loan amount. 20% down avoids PMI. Some jumbo programs allow 10-15% down with higher rates and PMI. Investment property jumbos require 25-35% down.
Reserves
6-12 months of PITIA reserves required. Higher loan amounts need more reserves. Self-employed borrowers may need 12+ months. Reserves can be in retirement accounts but only 60-70% counted.
DTI Limits
Maximum DTI of 43% for most jumbo loans. Some lenders allow up to 45-50% with strong compensating factors (high credit score, large down payment, significant reserves).
Rates
Jumbo rates are typically 0.25-0.5% higher than conforming. The gap varies by market. Some portfolio lenders offer competitive jumbo rates. Rate locks for jumbos may have shorter windows.
Alternatives to Jumbo
Alternatives: piggyback loan (80% first + 10% second = 90% total avoids jumbo), portfolio loan (may have more flexible terms), or reducing the loan amount to conforming limits with a larger down payment.