Jumbo Mortgage Lending Limits

As this was written in 2007, the maximum loan amount for standard, FHA-conforming mortgages is $417,000 for single-family homes in the lower 48 states and $729,500 in Alaska, Hawaii, Guam and the U.S. Virgin Islands, because Freddie Mac and Fannie Mae will not buy or guarantee mortgages that exceed this cap.

Bills.com makes it easy to compare mortgage offers and different loan types. Follow the hyperlink I just mentioned to learn more.

Although mortgages are available above this cap, loans larger than these limits are referred to as "jumbo mortgages," which, though fairly common, usually require a higher interest rate and down payment than a smaller confirming loan for the same borrower. Generally speaking, a mortgage larger than $729,500 is referred to as a “super jumbo” mortgage. Since Freddie Mac and Fannie Mae will not purchase these large loans, mortgage companies look to other investors, such as banks and institutional investors, to fund jumbo mortgages. Because of the higher risk faced by lenders when lending such large amounts of money, they charge higher interest rates on these loans, with the interest rate tending to increase with the size of the loan.

There is really no absolute maximum amount for jumbo mortgages; while the terminology changes to "super jumbo" after around $729,500, there is really no practical difference between jumbo and super-jumbo loans other than size. They are both non-conforming loans which must be funded outside of the conventional system designed for conforming mortgage loans. As mentioned previously, the interest rates on jumbo mortgages tend increase with the size of the loan, as lenders are putting more money on the line, and stand to lose more in the case of default. In addition, lenders usually ask for larger percentage of the purchase price as a down payment for jumbo loans than they would on comparable conforming loans, and they generally do not offer no down payment loan options on jumbo loans.

As for your question about "CAA jumbo programs," I must admit that I am not familiar with this type of loan program, so unfortunately I cannot tell you which states offer this type of loan.

To learn more about mortgage loans, I encourage to visit the Bills.com Mortgage Resources page.

You can also receive competitive quotes from multiple lenders at Bills.com.

I wish you the best of luck in finding a mortgage loan that meets your needs.

I hope that the information I have provided helps you Find. Learn. Save.

Best,

Bill

Bills.com