Jumbo. Non-conforming. Portfolio loan. Non-agency loan. What’s the difference?

A jumbo loan, also known as a non-conforming loan, portfolio loan, or non-agency loan, describes a mortgage loan exceeding the conforming loan limits set by Freddie Mac (FHLMC) and Fannie Mae (FNMA).

What are the limits? In most U.S. counties, the conforming loan limit is $417,000; a mortgage exceeding that limit is a jumbo loan. In some areas, like the San Francisco Bay area, the amount varies by county and can range from $417,000 to $625,000. To find out the jumbo loan limit in the county where you want to buy, call us at 866-612-5050, or email a Guarantee Mortgage Loan Advisor.

If your desired loan amount exceeds set limits, a jumbo loan will cover the full amount. Or, consider a conforming loan with a “piggyback second” to bridge the gap between the conforming and non-conforming amounts. Every situation is different, so email us or give us a call at 1-866-612-5050. We’ll talk to you about the guidelines various lenders offer.

Characteristics of a jumbo loan.

  • Interest rates for a jumbo mortgage tend to be higher than those for a conforming loan, depending on market conditions
  • Available in both fixed and adjustable rate terms. Fixed options include 30, 20 and 15-year terms. ARM options include fixed period of 5, 7, or 10 years
  • Tend to have higher down payments and cash reserve requirements, depending on lender guidelines
  • Financing is possible for loans of up to $5 million
  • Delayed purchase financing options are available

Is a jumbo loan the right mortgage option for you?

A jumbo loan is standard fare for California’s high-value real estate properties. A jumbo loan may be right for you if you:

  • Don’t want to bring the loan amount down to conforming limits through a more sizeable down payment
  • Don’t want to bridge the gap between the conforming loan limit and desired loan amount using a piggyback second mortgage
  • Are buying in an expensive housing market or want to upgrade to a larger, single-family home