Jumbo Loan:The New Rules of Qualifying

Darrin Seppinni
Written by:
Jumbo Loan: Non-Bank Mortgage Who Are They For and What Are the Benefits

You Don't Need to be Perfect to Get a Jumbo Loan Anymore

A loan is considered Jumbo if the amount of mortgage exceeds loan limits set by Fannie and Freddie Mac-currently $510,400 for a single home in all states (except Hawaii, Alaska, and a few federally designated high-cost markets, where the limit is $765,600).

Traditionally Jumbo loans have carried tighter underwriting guidelines requiring stellar credit, low debt-to-income ratio, and plenty of reserves.  However, a new breed of Jumbo loans has entered the marketplace, giving borrowers a new option when shopping for a larger sized loan amount.

A Non-Bank Jumbo loan is an alternative type of loan, known in the industry as a non-qualified mortgage, or NonQM.  Quite simply means that it does not fit the tight standards created by banks, credit unions, and other lenders.

Who is this type of home loan for? How can you benefit from having one? Here’s what you need to know.

Who Is A Jumbo Mortgage For?

If you’ve been turned down for a Jumbo loan by a bank or credit union, the good news is you still have options.  You might want to consider a non-bank Jumbo loan if:

  • Your debt-to-income (DTI) ratio is high
  • Your Tax Returns don't support your actual income
  • You need a loan that is over the conventional loan limit
  • You do not have enough reserves
  • You are self-employed or have seasonal income
  • You have a lower credit score 

Whether you are buying a pricier home or need a higher loan amount for your cash-out refinance, a Non-bank Jumbo home loan is a great option.

The Benefits of a Jumbo Mortgage 

What are the benefits of getting a non-bank Jumbo home loan over a traditional Jumbo loan? The biggest one is that non-bank Jumbo loan requirements are a lot more flexible. 

3 Ways to Income Qualify

  • Only 1 year of Tax Returns
  • 12 – 24 months business or personal bank statements (self-employed only)
  • Liquid assets depletion
  • While you do still have to document your income, you can have a debt-to-income ratio of up to 50% -55% in some cases. 
  • You’ll only need 10% down when buying a home and NO MI is required.
  • For a cash-out refinance you can finance up to 80% of your home’s value
  • You’ll need a minimum 660 credit score
  • Flexible terms include 15, 30, and 40 fixed year terms with Interest-Only option.
  • Loan amounts from $510,401 to $20,000,000

    The type of properties you can finance with a Jumbo Non-bank home loan include single-family residences, townhomes, 2-4 units, or condo’s — including non-warrantable condos. 

While many traditional Jumbo loans are limited to your primary residence, a non-bank Jumbo loan will allow you to finance a second home, vacation home, or investment property.


Are Non-Bank Lenders Safe?

There are a lot more non-bank mortgage firms than you realize. In fact, more than 40% of customers believe non-banks are a better lending option than traditional banks.

Top non-bank mortgage brokers, while more nimble than traditional banks, can reduce processing time, allowing them to offer interest rates that make it hard for traditional lenders to compete.  That’s why more than half of all mortgages in 2017 were from non-bank lenders vs. banks.

If you’re ready to buy your dream home, or need a refinance, but you have a non-traditional situation, don’t give up.  By choosing a non-bank mortgage broker, you can rest knowing you’re in good hands.

Homelife Mortgage is a boutique mortgage broker, highly experience in NonQM lending, offering Jumbo Mortgage Non-bank home loans, Self-Employed bank statement loans, and real estate investor loans.  If you’re ready to get started, contact us today!

Ready to Get Started?

If you think you're ready for a Jumbo Bank Statement Loan of your own, learn more about how to qualify by downloading our free eBook, The Ultimate Guide for Self-Employed Bank Statement Mortgages.


More Content For You:

Jumbo Non-Prime Loans

Jumbo Non-Prime Loans - What Are They?

Self-Employed Mortgage: Buy a Home With a Bank Statement Mortgage


Click the live chat window on our site or call (888) 677-2526.  Our team is ready to assist you!

About HomeLife Mortgage

For more than 25 years, HomeLife Mortgage has built a strong reputation in California and Florida as a leading mortgage broker, servicing the needs of borrowers who have been unable to obtain conventional financing.  HomeLife Mortgage is at the forefront of non-bank lending offering the next generation of mortgages including Jumbo Loans, Real Estate Investor Loans, and Bank Statement Loans.

Related Posts