Are you searching for a luxurious home in Fort Lauderdale? Are you concerned about the down payment requirements that come with traditional Jumbo mortgages? Well, worry no more, because there is good news for you!
Qualified buyers now have options for low down payment jumbo loans with 10% and even a 5% down payment. Additionally, piggyback loans are also available with no mortgage insurance (PMI). In this post, we will cover all the basics of jumbo mortgages, their benefits, and how you can take advantage of them in Fort Lauderdale. So, let’s get started!
Current Real Estate Market Trends in Fort Lauderdale:
Like most of Florida, the Fort Lauderdale real estate market has been experiencing good growth even as the national housing market has returned to more normal levels. With the city’s beautiful beaches, vibrant arts scene, and fantastic nightlife, it’s no surprise that more people are looking to relocate to the area. The median home sales price in Fort Lauderdale is currently sitting around $505,000. Additionally, the average time on the market for new listings is currently 29 days, which is considered a balanced market.
What is a Jumbo Loan in Fort Lauderdale?
Jumbo mortgages are home loans that exceed the conforming loan limit set by Fannie Mae and Freddie Mac. In 2024, the maximum conventional loan limit for single-family homes in most of Florida (Broward County included) is set to $766,550. Any loan above this limit is considered a jumbo mortgage. This means that jumbo mortgages are ideal for homebuyers looking to purchase luxury homes with higher price tags, often exceeding $1m.
Low Down Payment Options:
Gone are the days when jumbo mortgages required a massive down payment of 20% or more. Today, low down payment options with only a 5% down payment are available for approved buyers. This is a significant advantage for homebuyers who don’t have a substantial amount of cash on hand for a down payment or just want to retain cash for other investments.
This can also be helpful for home buyers relocating and have significant equity tied up in their current residence, they have listed but are waiting to sell. With low down payment options for jumbo mortgages, the dream of homeownership in a high-end residence is now possible.
Like all mortgages, the Jumbo financing options have requirements related to loan limits, reserve requirements, and documentation. Borrowers can read the most up-to-date guidelines on the Jumbo Purchase Page.
Fort Lauderdale Piggyback Jumbo Loans:
Piggyback loans are a popular option for jumbo mortgages; they allow borrowers to avoid private mortgage insurance (PMI), which is a big added cost. A piggyback loan is a second mortgage that is taken out at the same time as the primary mortgage.
The second mortgage is typically used to cover the 10% or 15% portion of the down payment required for the primary mortgage. With a piggyback loan, homebuyers not only avoid paying PMI, but they often can keep their first primary mortgage below the conforming loan limit, thus taking advantage of lower interest rates.
Example: Let’s say Jim and Mary are purchasing a home in Pompano Beach for $900,000 and they would like to finance 95% of the purchase price. In this example, the buyers would typically take out a first mortgage to the max conforming loan limit of $766,550. Their second mortgage balance would be $88,450 and the remaining 5% ($45,000) would be their out-of-pocket down payment.
Jumbo mortgages are an excellent option for homebuyers looking to purchase or refinance a luxury home. With low down payment options and piggyback loans available, homeownership is more achievable now than ever before.
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About the author: Jamie Chambers has been a mortgage professional and data researcher living in Florida for over 21 years. With vast experience in all sides of the banking, broker, and correspondent lending side of the business. Jamie is passionate about helping others understand the mortgage process and educating borrowers on all aspects of their mortgage.