The mortgage industry has long suffered from a few labels that were never standardized. The media usually lumps all loans that are above $417,000 (conforming Fannie Mae loan limits) together and calls them Jumbo loans. Some mortgage brokers and bankers define loans above $650K as Super Jumbo Mortgages while others consider it to be $850K and some at the $1M mark. The industry has never standardized a naming convention for loans above $417,000 so we are stepping in to straighten things out. We believe the following naming convention is the most logical, practical and properly labeled convention out there. As such we are pushing this as the correct naming conventions for all of our own loan officers, or mortgage partners (brokers that send us their deals), our investors, our conduit partners and anyone else who will listen to begin using this naming convention.
On with the new Jumbo Mortgage Scale:
‘Jumbo Loans’ range from $417,000 to $650,000.
‘Large Jumbo’ range from $650,000 to $1M.
‘Super Jumbo Loans’ range from $1M to $10M.
‘Ultra Jumbo Loans’ range from $10M to $50M.
Higher dollar mortgages (such as ultra jumbo) are not financed by traditional lenders or banks. These types of loans must instead be sold to investors that expect an incentive to purchase these mortgages in the secondary marketplace. Super and Ultra jumbo mortgages make up less than 1% of all mortgages. As such, borrowers seeking Jumbo loans need to consult with an experienced luxury lender to actually close on their loan. The secondary market provides considerable pricing incentives to lenders that have a large volume of jumbo business. As such, we recommend you work with a lender that originates a considerable jumbo mortgage volume.
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Posted in Jumbo Mortgages · Large Jumbo Mortgages · Mortgage Industry News · Super Jumbo Mortgages · Ultra Jumbo MortgagesNo Comments
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