Philadelphia Jumbo mortgage down payment requirements have recently changed to include more low down payment options. New jumbo loan programs permit financing up to 95% for qualified home buyers and include flexible terms with no mortgage insurance premiums.
Jumbo loans in Pennsylvania include any loan amount that is above the $726,200 conforming loan limit standard in 2023 set by Fannie Mae and Freddie Mac. The only exception to this is Pike County, which is considered “high cost” and has a conventional loan limit of up to $1,089,300. Keep in mind this limit pertains to the final loan amount, not the sales price of the property.
In the past, Jumbo loans usually required a large down payment of 20 percent due to the greater risk for lenders and banks. However, today well-qualified home buyers with good credit, income, etc. are finding more flexible options that don’t require such a large down payment.
Below we break down the basic down payment requirements and loan limits. We will also discuss some of the benefits of the reduced down payment programs for Philly home buyers. Questions? please connect with us today for quick answers 7 days a week.
Philadelphia Jumbo Mortgage Down Payment Chart:
- 20% down payment – available for loans up to $4mil. Credit requirements, debt-to-income limits, and payment reserves will be based on the exact loan amount.
- 15% down payment- available for loans up to $3.5mil. Buyers should have a 720+ credit score when financing over $2mil. Buyers with lower credit scores down to 660 can be eligible for loan amounts below $2,000,000.
- 10% down payment – available for loans up to $3,000,000. Buyers should have 720 credit when loan amounts exceed $2mil. 680 credit for loan amounts below this.
- 5% down payment – available for loans up to $1,500,000. Buyers should have a minimum 680 credit score. Loans $1.0m -1.5m will require a 720 score.
Philadelphia Jumbo Qualifying Restrictions:
- These programs are exclusively for primary owner-occupied and second homes. Single-family homes, townhomes, condos. New construction to be built and initially financed /sold to you by the home builder is also permitted. Vacant land or building on your own property is not permitted without a 20% + down payment.
- All programs will require a certain amount of payment reserves. This is the amount of savings a buyer has after the down payment and closing costs requirements are satisfied. Example: your mortgage payment with tax and insurance included comes out to be $6,000 per month. The program you choose requires 6 months of payment reserves, this means you should have $36,000 in reserve documented after closing. The reserve requirements can be met by traditional savings accounts or non-liquid retirement accounts – like IRA or 401K. The number of reserves will depend greatly on factors like transaction type (purchase, rate-term refi, or cash-out refinance) loan amount, down payment, and credit. In general, loans below $1,000,000 will require a minimum of 3 months of reserves, higher loan amounts can require 12+ months of reserves.
- All options do require full income and asset documentation, similar to conventional loans. Two-year employment history with W2s and/or tax returns for self-employed. Qualified business owners also have special bank statement deposit qualifying options available.
Jumbo Loan Features:
- Jumbo Purchase, rate & term refinance and cash-out refinance are available. * Cash out limited to 90% loan to value.
- All common fixed rate (30 year, 15 year, etc) and adjustable rate “ARM” terms available.
- No mortgage insurance, even for loans above 80% loan to value. Home buyers have a choice of a single loan, or “piggyback” 1st and 2nd mortgage programs. 80-15, 80-10, etc.
- Available nationwide * U.S. citizens only.
- Closing in as little as two weeks.
Have a question about applying? Homebuyers can learn more by calling the number above, or just submit the Quick Contact Form on this page.