The Difference Between Jumbo and Conventional Loans
In continuing my series of answering questions I get all the time, here’s another one: What is the difference between a jumbo loan and a conventional loan?
It all has to do with the amount that’s being financed. In northern Colorado, most counties have a loan limit of $484,350. Above that, it becomes a jumbo loan.
Conventional loans come from Freddie Mac or Fannie May, but jumbo loans are different. They tend to have stricter guidelines, require higher credit scores, need bigger down payments, take longer to process, and often require multiple appraisals.
As such, it can be a good idea to stay below the conventional loan limit. A 5% down payment on a $499,000 home would keep you below the limit, 20% down can get you a $605,000 home, and so on.
The best choice depends on your situation, so before you decide between getting a conventional or jumbo loan, reach out to me. I’d be happy to look at your situation, give you more information, and answer any further questions you may have. In the meantime, I look forward to hearing from you soon.