A Comprehensive Look at Jumbo Loans

Do you have a large piece of property or an expansive home that you are looking to buy as a private residence, but don’t have the capital to purchase it outright? Well then, you may be looking for a “jumbo loan”, a large loan that exceeds the lending capacity of many banks. Look here for information on jumbo loans and how they can help you with your real estate investment needs.

What are jumbo loans?

In terms of loans, jumbo loans are huge sums of money lended by a network of mortgage firms or a combination of loans and other creative financing sources. Jumbo loans exceed the limits set forth by Fannie Mae and Freddie Mac, the largest home mortgage lenders in America. Generally, a loan that exceeds $417,000 USD is considered a jumbo loan by Denver home mortgage companies.

Will a jumbo loan be right for you?

The first thing you need to ask yourself before taking on the responsibility of a jumbo loan is how much you can afford to put down on the home purchase price to reduce your long-term risk, especially in this market. Often having a network of investors to work with you and raise initial capital can reduce this risk substantially. Your monthly mortgage payments will be lower and you will end up paying less in interest and other fees for the life of the jumbo loan, which can take as long as 30 years to pay off.

Another thing to consider when looking at jumbo loan programs is that they have similar terms to other forms of home mortgage loans such as 15 or 30 year fixed mortgage rates and 30 year variable mortgage rates. Choosing one or the other can cause substantial hardship based on how well the mortgage rates perform in the future. It may be beneficial to find other means to finance the home purchase, such as combining the jumbo loan with FHA, CHFA, or ARM loans.

The good thing with jumbo loans is that mortgage companies and financial institutions understand that because of the size of the Denver home loan, a 30 year term is often the preferred method of repayment – with lower payments during the beginning of the loan period. This can be a plus if the property you are buying is an investment that will be upgraded and sold for profit within the first few years.

Why Naranche is your best source for a jumbo loan

Trying to manage a jumbo loan on your own is going to be a very stressful experience. You will want to consult with an experienced home mortgage banker like Naranche who can help you through the entire process. Naranche can give you the advantage as they have access to HELOC’s to offset any credit issues which take seconds through their banking relationships. In addition, the responsive professionals at Naranche can get your approval and closing scheduled in an acceptable time frame because they are the lender, not the middleman.