By Guest Blogger G. Knight
It has become a lot tougher to get hold of fresh mortgage loans in the country. However, even during tough economic times such as these first-time homebuyers are seeking to obtain jumbo mortgages in order to buy high-end properties in premium housing markets across the U.S.
So, if you are one amongst them, then you need to prepare yourself for the same and arm yourself with all the necessary knowledge about the prevalent mortgage trend across the States.
Real estate market – The most recent trends
Take for instance, San Fransisco Bay Area, a region with exorbitant property rates, where it is a norm amongst the first-time homebuyers to apply for jumbo mortgages that start from $625,501.
These loans have a value that is more than $417,000 required by home-buyers in other cheaper housing areas of the country. Speaking of San Fransisco Bay Area, it is a place where people are employed with technology majors that provide them with competitive salaries as compared to any other place.
High-cost areas such these have large multi-national corporations like Google and Twitter with people earning a much better pay packet at the end of each month. As a result, property prices too have appreciated significantly since the last 12 months.
What are the requirements to obtain a jumbo mortgage?
Being a first-time home-buyer, you may qualify for a jumbo mortgage loan, only if you can show a credit score not less than 700 that is sought by almost all the lenders. Moreover, you must be able to make a down payment of 20% and anything lesser than that won’t be accepted by the mortgage lenders.
Apart from that, you should have a savings fund that’ll last you for almost 9-18 months. This savings fund will come in handy, in case you struggle to make the monthly loan repayments at a later stage.
However, since you are a first-time home-buyer, then in that case, your lender might follow stringent loan origination criteria as compared to general lending practice. So, you might have to work with a lender who may set a cap on the amount of jumbo mortgage that you can qualify for. The restriction may not allow you to borrow more than one million as mortgage that you may require to buy a premium house.
Still, you can survey the mortgage market and locate a lender who may willingly offer you more than $1 million as jumbo mortgage. However, your debt-to-income ratio should ideally be lesser than 42 percent of your gross disposable income or GDI to get that.