Jumbo Loans
Tim's Citywide Team can help you buy the luxury home of your dreams with a fixed or adjustable rate (ARM) jumbo loan. We have very competitive jumbo interest rates and low closing fees. Loans up to 2 million get our lower preferred interest rates.
 
Jumbo mortgages are used to purchase higher-priced homes that require larger than normal loans. While they're convenient, they typically have slightly higher interest rates. Since the dollar amount that defines a jumbo mortgage is redefined each year, it's subject to change.

When a loan becomes a Jumbo
When a loan amount is higher than the conforming limit, it becomes a Jumbo Loan, or non-conforming loan, with slightly higher interest rates. The conforming loan limit is set every January. The 2010 limit for single-family home and condominium is $417,000

Strategies for avoiding jumbo rates
Because jumbo loans carry higher rates than conventional loans-consumers who are borrowing an amount that's close to the limit will often try to figure out ways to avoid triggering jumbo status. Some mortgage companies will let you take out two loans at the same time-one as a first mortgage for the bulk of the money, plus a small second mortgage that will work in tandem with the first. For example, for a $450,000 purchase, you might be able to use a conventional loan to borrow $415,000, and then come up with the rest through a smaller second mortgage for $35,000.

The interest rate on the smaller loan will likely be higher, but you can pay it off in a relatively short period of time. Avoiding the jumbo rate on the significantly larger loan more than pays for any added costs on the second loan.

Over the lifetime of a loan, the savings gained by qualifying for a slightly reduced rate can be huge, adding up to tens of thousands of dollars.    
    
An interest-only option is available. You can pay only interest for a specific period of the loan or pay interest plus as much principal as you wish. After the initial interest-only period ends, interest plus principal is due. Actual mortgage payment will vary based on your situation and the current interest rate when you apply.

Call Tim's Citywide Team today at (952) 224-2424 to learn more about our Jumbo loan programs and see the difference.