New Doctor mortgage programs have emerged to include lower down payment options. Medical professionals have 100% financing options available for loan amounts up to $500,000. 95% Jumbo financing is also available for much greater loan amounts. Today we will look at the latest home loan requirements for Physicians, please contact us with questions by calling the number above, or by submitting the Quick Contact Form on this page.
Note: Physicians seeking loan amounts up to $500,000 have options available with NO down payment. Buyers in need of larger “Jumbo” sized loans have options available up to 95% – please read below.
What is a Jumbo Loan?
Like the name suggests, a “Jumbo” mortgage is a mortgage that exceeds the conforming or conventional loan limits standardized by Fannie Mae & Freddie Mac. In most locations around the U.S. the conforming limit is set to $510,400. However, high-cost locations have increased loan limits up to $765,600. Note, this applies to one-unit properties, multi-unit properties are higher.
Benefits of a Jumbo Loan:
Jumbo loans are ideal for borrowers looking to purchase higher-priced over the conforming loan limit. These loans are designed to simplify home buying in luxury markets by covering the full cost of the loan, so there is no need for borrowers to deplete their cash reserves. And just like conventional mortgages, jumbo loans come with a variety of terms like fixed and an adjustable-rate 3/1, 5/1, 7/1 or 10/1 terms. The interest rates on a jumbo loan can be slightly greater due to the larger loan amount and incurred risk. However, this is often offset since most Jumbo loans do not have monthly mortgage insurance, even for loans greater than 80% loan to value.
Other benefits of jumbo loans include:
- High LTV options up to 95% financing available
- No PMI (Private Mortgage Insurance) required
- Assorted fix rate and adjustable rates options available
- Closings in as little as two weeks
Jumbo loan amount and down payment caps
These limits apply to both purchase and rate-term refinance. Note, there are also assorted Jumbo cash-out refinance options, please contact us to learn more.
- 95% Jumbo Financing – available up to $2,000,000
- 90% Jumbo Financing – available up to $3,000,000
- 85% Jumbo Financing – available up to $3,500,000
March 2020: Please note, due to recent changes in economic market conditions, loan amount and LTV limits can change. Please contact us for up to date limits.
Jumbo Mortgage Qualification Guidelines:
Now we will review the qualification requirements for a jumbo loan. To qualify for a jumbo loan, buyers should expect:
- Minimum 680 credit score to qualify for Jumbo loans over 90% loan to value. Greater credit scores of 720+ will often be required for higher loan amounts exceeding $2.0 mil
- Buyers will need to fully document income and assets for high LTV programs.
- The maximum debt-to-income ratio should not exceed 42 percent
- All jumbo loan programs will require payment reserves. This the remaining assets a buyer has once the closing is complete. This reserve amount will vary depending on the loan amount, down payment and credit score. Generally, six months’ worth of mortgage payment reserves will be needed. The good news is buyers can meet these requirements with non-liquid retirement accounts like 401K or IRA. Mortgage companies want to understand a borrower’s reserves as it demonstrates the buyer has the ability to meet their payment obligation.
Please contact us today to learn more about any of the programs. Our staff is here to assist you 7 days a week.