JUMBO LOANS

Why get an Jumbo loan?

Jumbo loans can help homebuyers purchase “more house,” such as luxury properties or vacation homes, without tapping into savings.

The primary advantage of a jumbo loan is that it allows borrowers to take out a mortgage that exceeds the limits put in place by the FHFA.

This limit varies by state—and even by county. The FHFA sets the conforming loan limit size for different areas on an annual basis. The limit for 2023 is set at $726,200 for most of the country. This is an increase of $79,000 from the 2022 limit of $647,200. For counties that have higher home values, the baseline limit is set at $1,089,300, or 150% of $726,200.1

The FHFA has a different set of provisions for areas outside of the continental United States for loan limit calculations. As a result, the baseline limit for a jumbo loan in Alaska, Guam, Hawaii, and the U.S. Virgin Islands as of 2023 is also $1,089,300. That amount may actually be even higher in counties that have higher home values.

If you have your sights set on a home that costs close to half a million dollars or more—and you don’t have that much sitting in a bank account—you’re probably going to need a jumbo mortgage.