Although 10% is typically the minimum down payment for a Jumbo Mortgage, there is an option to for a Jumbo Mortgage with just a 5% down payment.
Jumbo Mortgages are Available with just a 5% Down Payment
Sometimes we meet homebuyers who have plenty of down payment saved but they do not want to tie this money up in the equity of their new home. Once a down payment is made, accessing these funds can only be possible with an an additional cash out refinance or home equity loan. This is not always cost effective. Minimizing down payment and letting this money perform in other segments of an individual portfolio often makes more sense for long-term asset growth.
Things to Know about the 5% Down Payment Jumbo Mortgage
- Minimum credit score of 680
- Maximum loan amount of 1.5 million
- Maximum Debt ot Income Ratio of 35%
- No mortgage insurance required for the 5% Down Payment Jumbo Mortgage
- Single Family Residences only
- Approved Warrantable Fannie Mae Condos are eligible
- Second Appraisal not required
- Chapter 13 Bankruptcy must be discharged at least 2 years
- Chapter 7 Bankruptcy must be discharged at least 4 years
- Multiple Bankruptcies not allowed
- Foreclosures must be at least 7 years from previous Deed
- Gift funds are allowed after Borrower contribution of at least 5%
- US Citizens and documented Permanent Resident Aliens
- Interest rates usually .5% to .75% higher than the 10% down Jumbo program
Disclosure of terms as of 4/02/2019: Applicant credit score of 760; 540K sales price with a 513K loan amount on a 30 year fixed rate of 5.5% would result in a Principal and Interest Payment of $2913 and an APR of 5.664%. Terms and conditions will vary according to market conditions and your exact credit score.