Qualifying For a Super-Size Jumbo Mortgage

Here is a news flash for you in case you have not noticed. In many areas of the price of a home is well above the old $417,000 conventional loan limits! This could potentially add another level of stress to first-time home buyers who are preparing to jump into this part of the market. However, do not worry because I have put together a guide to walk you through the differences and what to expect when you need a lot more than $417,000 to buy your home:

• ABSOLUTELY use a mortgage broker. Mortgage brokers are mortgage professionals who have access to dozens if not hundreds of lenders. A mortgage broker will be able to shop almost every bank for you without you having to contact each bank personally and go through the application process.
• Expect to pay a slightly higher interest rate. You have to be prepared to ignore those annoying advertisement commercials that promise you 4.99% interest rates on a million dollar mortgage. They are simply not true for the majority of us.
• Be prepared for additional time to close. Lenders usually have more questions and need more careful market analysis when lending on luxury homes. They are not picking on you. It is because luxury homes usually take longer to sell.
• You make be asked for additional income documentation. This is not the time to play vague mystery guy with rich relatives. Lenders want to know who, when, why and where from.
• Your credit reports will be more closely scrutinized. Due to the mortgage amount any little blemish on your credit could become a blaring issue in light of trying to borrow a jumbo amount of money.
• Be willing, ready and able to talk about where your money comes from and why you get paid the way you do. It is very likely that if you are seriously considering a jumbo mortgage then you make jumbo-like income. With that being said it is even more important that you be open, honest and forthcoming about every source of income reflecting on your tax returns.
• Get out the checkbook because the appraisal and home inspection will cost considerably more than average homes. Be prepared to pay slightly higher prices for your real estate services because of the risk involved with doing a larger mortgage.

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