What is a Jumbo Mortgage?
Loans to help you qualify for a luxury residence
Considering a Jumbo Loan in Colorado?
Review loan programs to finance a home valued over $850,000
The current conforming loan limit for a single-family home is up to $802,650. For Colorado borrowers conforming "High Balance" limits range from $816,500 to $856,750 based on the county where your property is located as of January 1st, 2024. Any loan amounts that exceed these limits will fall into the category of a jumbo loan.
How is a Jumbo Home Loan Different?
Jumbo loans are mostly the same as conforming loans except they are not backstopped by the government. Rates tend to be .375 to .50% higher and they have higher minimum credit score and liquid reserve requirements. Jumbo loans are made for borrowers with high-income seeking to buy a home in expensive neighborhoods within Colorado while conforming loans are designed to help the average homebuyer become a homeowner.
Due to high home values in Boulder, Denver, Steamboat Springs, Vail, Aspen and other cities in Colorado, jumbo home loans are commonly used to finance the purchase of a home in these markets. Homeowners in this segment typically choose to own a luxury home that has views of the Flatiron Mountains, Green Mountain, Rocky Mountain or another natural landscape. Basically, a jumbo mortgage helps facilitate the financing of homes for sale from $808,000 to well above $1 million dollars in highly desired neighborhoods.
Jumbo Loan Overview Chart
| Max. Sales Price / Appraised Value | Credit Scores Between | Req'd Down Payment / Equity | Maximum You Can Borrow | (P.I.T.I.) Reserves | DTI |
|---|---|---|---|---|---|
| $3.33 Million | 740 to 820 | 10 | $802,651 to $3 million | 6 to 12 months | 38 to 50 |
| $5.33 Million | 740 to 820 | 25 | $3.1M to $4 million | 12 months | 38 to 50 |
| $5.85 Million | 740 to 820 | 30 | $4.1M to $10 million | 12 to 18 months | 38 to 50 |
| $3.53 Million | 700 to 739 | 15 | $802,651 to $3 million | 6 to 12 months | 43 to 50 |
| $3.75 Million | 660 to 699 | 20 | $802,651 to $3 million | 6 to 12 months | up to 50 |
DTI: debt to income ratios will be calculated. See how DTI is calculated in the loan glossary.
LTV: loan to value maximums (loan amount / home value)
Jumbo Mortgage Rates in Colorado
As mentiond above, the mortgage interest rate for a Colorado jumbo home loan is typically higher than conforming loan rates. However, rate specials do occur periodcally which may be the same as a conforming rate. Overall the interest rate is determined by various individual factors which include:
– Your middle FICO credit score from the lender's tri-merge credit report
– Overall debt-to-income ratios
– Loan type; adjustable or fixed-rate
– Your down payment amount (or equity for a refinance)
– How you will document income. traditional or non-traditional
Are there low down payment jumbo mortgage loans?
Great ways to finance a luxury home with less than 20-percent down.
The short answer is yes. There are some low down payment products like the 90-percent jumbo mortgage financing program up to $2,000,000. Home buyers who want this high LTV jumbo financing product will need to have 720 or higher middle credit scores, at least 6 months of the proposed mortgage payment in liquid reserves, and a debt-to-income ratio (DTI) of 45 or less.
The jumbo loan examples shown below feature no PMI for borrowers with less than 20-percent down. A second method to get rid of PMI is to get a piggyback second loan to stay within conforming loan maximums.
- $802,651 up to $3 million — as low as 10-percent down (up to 90 LTV refinance)
- $3 million to $10 million — 25-40 percent down payment (55-70 LTV for refinancing)
The above down payments represent a borrower with a 760 score and a primary home. Higher down payments are required with lower credit scores or 2-4 units.
Are 5 percent down jumbo loans available?
As of Oct. 2024, you can receive gift funds from a relative for all of the down payment. So, yes, a 5-percent down payment jumbo or even zero down is obtainable with help from a family member or through a VA jumbo loan.
10 Percent Down Jumbo Mortgage - 90 LTV
— As of Oct. 2024, the single loan product with 10-percent down up to $3 million on a primary residence with no mortgage insurance.
If you need a jumbo loan with 10 percent down and you're self-employed be sure to review our bank statement mortgage qualifications for business owners, consultants and freelancers. It is a pretty convenient loan if you have large write-offs on your tax returns.
Jumbo Refinance Loans in Colorado
Not only can you use a jumbo loan to purchase a home in Denver, Boulder, or other Colorado cities, but it’s also a good way to refinance your current home loan. If your employment status has switched from being salaried to 1099 and self-employment after you purchased your home, refinancing with a bank statement loan may help you get better terms, qualify for cash-out, or reduce your mortgage payment.
Expedite the Process
The process to close a mortgage can be more efficient and smooth when you are organized and have all your documents ready to send.
- ● Gather copies of 2 months of account statements for all funds being used for the down payment and to close.
- ● Gather copies of tax returns for the last two years and your most recent paystub or YTD P&L if self-employed.
- ● Gather a copy of your mortgage statement or if you're renting copies of the last 12 months of rent checks and the landlord contact info.
- ● Prequalify with a licensed mortgage originator to confirm if you qualify.
Still have questions? Check these answers
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What reasons will a lender not approve my jumbo loan?
Your credit scores, cash reserves, debt ratios, or employment doesn't satisfy the underwriter's minimum guidelines.
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Is an interest only payment option available?
Yes, on certain jumbo programs an interest only payment option is available for the first 10 years of the loan then it converts to a fully amortized payment.
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How can I get a conforming loan when the loan amount I need is over the conforming limit?
When the loan amount you need is 5 to 15 percent above conforming limits you may want to consider two mortgages. The first loan is the conforming maximum limit of $802,650 and then get a small second mortgage to close concurrently. Sometimes it's worth it while other times it doesn't help the borrower.
Areas Served
We serve borrowers throughout the state of Colorado which includes these cities:
- Boulder
- Denver
- Colorado Springs
- Fort Collins
- Cherry Creek
- Littleton
- Highlands Ranch
- Englewood
- Castle Rock
- Windsor
- Avon
- Vail
Disclosure: The minimum loan amount for jumbo lenders is $802,651. Loan programs are subject to change per lender at any time until the loan is approved and the rate is locked. Borrowers must be approved by underwriting. Not all applicants will qualify. The programs above do not include homes with 20 acres or more, log cabins, hobby-farms, or agriculturally zoned properties.