Jumbo Loan Guide: Limits, Qualification & Programs

Conforming Loan Limits and What Makes a Loan Jumbo

A conforming loan is one that meets Fannie Mae and Freddie Mac's purchase requirements, including being below the FHFA conforming loan limit for the county where the property is located. The conforming limit is updated annually by the FHFA.

Most U.S. counties follow the national baseline conforming limit. Counties designated as 'high-cost areas' have elevated limits up to 150% of the national baseline. In our licensing footprint, high-cost designations include some Colorado mountain-resort counties (Pitkin/Aspen, Eagle/Vail, San Miguel/Telluride, Summit/Breckenridge, Routt/Steamboat) and Monroe County in Florida (the Keys). Most other counties in FL, TN, SC, CO, and TX follow the national baseline.

Loans above the applicable conforming limit are jumbo loans. The exact threshold matters — a $1 difference between a conforming and a jumbo loan can shift the qualification and pricing meaningfully. Your loan officer can confirm the 2026 conforming limit for the specific county where the property is located.

Jumbo Loan Qualification

Because jumbo loans cannot be sold to Fannie Mae or Freddie Mac, lenders set their own qualification standards rather than following the Agency rules. This means jumbo standards vary between lenders, but the general framework:

1. Credit profile. Typically 700-720+ for best pricing. Some lenders go down to 660-680 for jumbo, with higher rates and stricter other requirements.
2. Down payment. 10-25% on most jumbo programs. Higher down payment for larger loan amounts (typically 20%+ for loans over $1M, 25%+ for super-jumbo).
3. Debt-to-income. 43% maximum is the typical cap, with the best pricing for borrowers under 38%. Some jumbo lenders allow higher with strong compensating factors.
4. Reserves. 6-12 months of full PITIA payments in liquid reserves after closing. Reserves are a particular focus for jumbo lenders because of the larger loan size.
5. Income documentation. Full documentation typically required. W-2, paystubs, tax returns (2 years), and sometimes profit-and-loss statements for self-employed borrowers. Bank-statement and asset-based programs are available for borrowers whose tax returns don't fully reflect their financial picture.
6. Property type. Primary residence, second home, and investment property all available, with progressively tighter standards for non-primary occupancy.

Super-Jumbo Loans

Super-jumbo is a loose term for loans in the $2-3M+ range — well above standard jumbo thresholds. Pricing and qualification tighten further:

1. Down payment. Typically 25-30%+ for super-jumbo. Some private-bank programs allow lower down payment with pledged-asset structures.
2. Credit profile. Strong credit required — typically 720-740+ for competitive pricing.
3. Reserves. 12-24 months of PITIA in liquid reserves is common.
4. Income or asset documentation. Full documentation or asset-based qualification using liquid assets to substitute for income.
5. Loan structure. 30-year fixed, 15-year fixed, 7/6 ARM, and 10/6 ARM are the most common. Interest-only options are available on some super-jumbo programs.

Super-jumbo activity is concentrated in specific markets: Aspen, Vail, and the Colorado mountain resorts; Miami, Palm Beach, and South Florida coastal; the Florida Keys; the Houston, Dallas, and Austin high-end markets; the Greenville and Charleston high-end markets in South Carolina; and the central Nashville and Williamson County markets in Tennessee.

VA Jumbo Loans

VA jumbo is VA financing for loan amounts above the county conforming limit. There is no maximum VA loan amount — VA's guarantee structure adjusts based on the borrower's entitlement and the loan amount.

The math on VA jumbo: VA fully guarantees the loan up to the county conforming limit (using the borrower's full entitlement). Above the conforming limit, VA's guarantee requires the borrower to contribute 25% of the difference between the loan amount and the conforming limit. So on a $1M VA loan in a county with a $766,550 conforming limit (illustrative), VA would guarantee the first $766,550 fully; the remaining $233,450 would require 25% × $233,450 = $58,362 in borrower down payment.

VA jumbo has no monthly mortgage insurance (unlike jumbo conventional) — the VA funding fee applies (and is waived for service-connected-disabled veterans), but the lifetime cost can be lower than conventional jumbo for eligible veterans in high-cost markets.

Asset-Based and Bank-Statement Jumbo

Asset-based and bank-statement jumbo programs serve borrowers whose tax returns do not fully reflect their financial picture — typically retirees, self-employed business owners, real estate investors, and high-net-worth individuals with complex tax structures.

Asset-based qualification (asset depletion). The borrower's liquid assets are 'depleted' over an assumed period (typically 60-120 months) and the resulting monthly figure is treated as income for qualification. So $1.2M in liquid assets depleted over 60 months produces $20,000/month in qualifying income. Asset depletion is widely used for retirees with substantial savings but modest current income.

Bank-statement qualification. Self-employed borrowers use 12-24 months of business or personal bank statements to demonstrate cash flow, with a percentage of deposits treated as qualifying income. The exact calculation varies by lender but typically allows 50-100% of business deposits to count toward qualifying income.

Pledged-asset programs. Some private banks allow the borrower to pledge liquid assets (stocks, bonds, brokerage accounts) as additional collateral, reducing or eliminating the down-payment requirement. The pledged assets remain owned by the borrower but cannot be sold or withdrawn until the loan is paid down to a target LTV.

Jumbo Refinance

Jumbo refinance follows the same general framework as conforming refinance — rate-and-term and cash-out variants — with jumbo-specific qualification standards.

Rate-and-term jumbo refinance is widely available; the principal qualification is meeting the lender's jumbo standards on credit, DTI, reserves, and property. Cash-out jumbo refinance is tighter: LTV caps are typically 70-75% (vs 80% on conforming), reserves requirements are higher, and pricing is somewhat tighter.

Texas-specific note: Texas Section 50(a)(6) applies to cash-out refinances of Texas homestead property regardless of loan amount, including jumbo. The 80% LTV cap, 3% fee cap, 12-day cooling-off period, and other Section 50(a)(6) rules apply to jumbo cash-out the same as to conforming cash-out on Texas homesteads.

Jumbo Pricing vs Conforming

Historically, jumbo loans priced at a small premium to conforming — typically 0.10-0.40% in rate. The reason: conforming loans can be sold to Fannie Mae and Freddie Mac, while jumbo loans are held by the originating lender or sold to private investors with thinner demand.

Since roughly 2018, the spread has been compressed and at times reversed — jumbo rates have actually run slightly below conforming in certain market conditions, particularly when private investor demand for high-balance paper is strong. This is unusual historically but reflects how the credit markets have evolved.

Borrowers near the conforming-jumbo threshold should run both scenarios with their loan officer: take the loan at conforming and put more cash down (so the loan is conforming) versus take a slightly larger loan that crosses into jumbo territory. The right choice depends on the rate environment, the borrower's cash position, and the lender's specific pricing.

State-Specific Notes

Jumbo activity varies enormously by state and metro. Where jumbo comes into play most:

Florida

Florida jumbo activity is concentrated in Miami-Dade, Palm Beach, parts of Broward, Monroe (the Keys), and central coastal markets. Florida has substantial foreign-national and non-QM jumbo activity. Florida coastal insurance complexity affects jumbo qualification because insurance costs flow through DTI.

Texas

Texas jumbo activity is concentrated in central Austin (Travis County) and parts of Dallas and Houston. Texas Section 50(a)(6) applies to jumbo cash-out on Texas homesteads. Property tax rates affect jumbo qualification in Texas.

Tennessee

Tennessee jumbo activity is concentrated in central Nashville (Davidson), Williamson County, and select high-end markets in Knoxville and Chattanooga. Most Tennessee secondary markets remain firmly conforming.

South Carolina

South Carolina jumbo activity is concentrated in Charleston (Charleston County), Hilton Head (Beaufort County), parts of coastal SC, and the upscale parts of Greenville and Mount Pleasant.

Colorado

Colorado has the most extensive jumbo activity per capita of the five states we serve — central Denver and Boulder require jumbo for most median-priced homes, and the mountain-resort markets (Aspen, Vail, Telluride, Steamboat, Crested Butte) generate substantial super-jumbo activity.

Frequently Asked Questions