Jumbo Loans Versus Conventional Loans
What is the difference between jumbo loans and conventional loans? Organizations such as Freddie Mac and Fannie Mae come out with what they think the cap of a mortgage loan should be. They come out with this figure each January by averaging home pricing around the country. If you need a loan that is higher than this top amount, then you will be asking finance companies for a jumbo loan. Jumbo loans can be harder to qualify for, have higher interest, and may have longer payment terms, ie 40 years versus 30. In some cases, lenders may be able to get around the higher rates and longer terms, but it is on a case by case basis for each jumbo loan.
