Jumbo Interest-only Mortgages Put Your Real Estate Goals in Reach
Do your plans include owning a piece of luxury real estate? If so, a jumbo mortgage might be in your future.
When a property’s price tag exceeds the conforming loan limits for conventional loans, a jumbo mortgage can help. In most areas, the conforming loan limit will be $647,200 for 2022. In designated high-cost areas, the conforming loan limit will be $970,800.
As you would expect, jumbo mortgages come with high monthly payments. To minimize financial strain, some eligible borrowers opt for Jumbo Interest-Only mortgages. At MortgageDepot, we have access to this less-common mortgage product. If you have your eye on a high-cost property, read on to learn the basics of our Jumbo Interest-Only loan program.
MortgageDepot’s Jumbo Interest-Only Eligibility Requirements
Our Jumbo Interest-Only loan program applies to 30-year interest-only fixed mortgages. For the first ten years of the mortgage term, borrowers pay only the interest on the loan. The interest-only period is followed by a 20-year amortization period in which the borrower is responsible for the fully-amortized monthly payment. Here are a few additional highlights and requirements:
- Our Jumbo Interest-Only loan program applies to amounts from $1 above the conforming loan limits up to $3 million total.
- Home purchases and rate/term finance transactions are eligible for this program.
- Qualifying purchases include primary and secondary homes.
- Investment properties, cash-out refinance transactions and properties that have between three and four units are NOT eligible.
- Borrowers must have a minimum credit score of 700.
- The maximum loan-to-value ratio (LTV) allowed is 80%.
- Fannie Mae’s Desktop Underwriter (DU) must be used to review the borrower’s eligibility. Approve/Ineligible status is acceptable.
- The borrower’s maximum debt-to-income ratio (DTI) cannot exceed 43%.
- The borrower must have at least 12 months of reserves.
- Restricted Stock Units (RSU) are an acceptable income source.
- Escrow waivers are available at no additional cost.
- Appraisal waivers are not permitted.
- Mortgage recast transactions are not permitted.
Contact Us Today!
You deserve that piece of luxury real estate, but you might need a jumbo mortgage to get there. If you’re ready for the home and almost ready for the payments, contact our knowledgeable loan professionals to see if our Jumbo Interest-Only program is right for you!
Connect with one of our loan consultants to learn more.