Down payment requirements for jumbo loans have been changing in recent years. Many homebuyers in Colorado still aren’t aware they can finance up to 95% loan to value through select lenders and banks.
Long gone are the days when a 20 percent down payment was the standard on jumbo loans. Not only can eligible home buyers be approved for 5% down jumbo loans, but they can do it without paying monthly PMI.
This program is helpful for home buyers purchasing in high-cost locations in Denver, Boulder, Aurora, Pueblo, Colorado Springs, etc. Let’s dig into the program details below, please check the Jumbo Purchase page above for more details.
The first thing to keep in mind is all the requirements listed below apply only to Primary and Vacation Home Purchases or Rate-Term Jumbo Refinance. Investment properties can be purchased, however, the down payment, reserve and credit standards will be higher.
- 95 percent financing – 680 minimum credit score required. $1,750,000 loan amount limit.
- 90 percent financing – lower credit scores to 660 are eligible depending on financed amount. $3,000,000 loan amount limit.
- 80-85 percent financing – loan amount limits over $3,500,000 – credit scores and reserves will vary.
The second thing applicants want to remember is all the jumbo programs above require full income and asset paperwork. Applicants must provide proper pay stubs for 3 months, W2, and tax returns for two years. Just two years of tax returns for self-employed 1099 borrowers. Assets will need to be verified – only assets required to document down payment and reserves requirements.
Reserves can vary depending on the loan amount, credit, LTV, etc. For the 5% down, jumbo buyers should plan to have at least three months of reserves. Keep in mind, this requirement can be satisfied by non-liquid retirement accounts.
Finally, the property types that are eligible include Single-family homes, town homes, and condos – they should be in overall good repair to be approved. New construction spec homes when initial financing is being provided by the builder is permitted. Special Jumbo construction loans are available for borrowers building on their own lot.
Have questions, please submit the Quick Contact form on this page, or call 800-962-0677
Serving buyers across the nation, including CO: Denver County, El Paso, Arapahoe, Jefferson, Adams, Larimer, Douglas, Boulder, Weld, Pueblo, Mesa County