Reviewed by the Editorial Team · Updated July 10, 2026 · 6 min read
A jumbo loan finances a home above the conforming loan limit, so Fannie Mae and Freddie Mac won't buy it — the lender keeps it on its own books and sets its own rules, typically wanting a 700+ score and 10-20% down.
Key takeaways
A jumbo loan finances a home priced above the conforming loan limit, so Fannie Mae and Freddie Mac won't purchase it from the lender.
Because the lender keeps the loan on its own books, it sets its own rules, typically wanting a 700+ score and 10-20% down.
Two separate appraisals are often required to confirm the home's value before a lender takes on that much risk.
It fits buyers in high-cost metro areas whose home price exceeds standard limits, not just anyone wanting a bigger loan.
Min. down payment
10-20% typical
Min. credit score
700+ (bank-set, no federal floor)
Key cost
Often two appraisals required
Best for
High-cost-area buyers above the limit
Today's Jumbo 30-year rate6.55%avg · Optimal Blue OBMMI · as of Jun 27, 2026
Estimated monthly payment at today's rate
Loan amount
Monthly P&I
$800,000
$5,083/mo
$1,000,000
$6,354/mo
$1,500,000
$9,530/mo
Principal & interest only, 30-year term at 6.55%. Taxes, insurance and any mortgage insurance are extra. See today's rates →
How a jumbo loan works
A jumbo loan is any mortgage larger than the conforming loan limit, the ceiling on what Fannie Mae and Freddie Mac can buy. Because those agencies won't purchase it, the originating bank holds the loan itself and absorbs all the risk.
Score: 700 or higher at most lenders
Down payment: 10-20%, sometimes less at private banks
Reserves: several months of payments in the bank
Documentation: full income and asset paperwork, no shortcuts
Conforming vs. jumbo loans
Conforming
Jumbo
Credit score
620+ typical
700+ typical
Down payment
3-5% with PMI
10-20%
Backed by
Fannie Mae / Freddie Mac
Held by the lender
Documentation
Standard
Full doc, often more reserves
In high-cost counties, a middle tier called a high-balance conforming loan sits between the standard limit and jumbo territory. It still sells to Fannie or Freddie, so it's worth checking before assuming you need a jumbo.
Jumbo pricing isn't set by a formula the way conforming loans are — it's negotiated. Two lenders can quote meaningfully different rates for the identical borrower on the identical property.
Some jumbo loans also require two independent appraisals instead of one, adding cost and a few extra weeks to closing. Lenders use the second opinion to protect a loan they can't offload to Fannie or Freddie.
Relationship leverage
Banks often price jumbo loans better for existing depositors. Moving investment or savings accounts to the lender can shave real basis points off the quoted rate.
Who a jumbo loan fits
Jumbo loans fit buyers in expensive metro areas where a typical home price simply exceeds the conforming limit, not just high earners chasing a luxury property.
A credit score of 700 or better, ideally higher
10% or more saved for a down payment
Cash reserves beyond the down payment and closing costs
A home price above the conforming limit in your county
If your loan amount lands just above the standard limit, ask about a high-balance conforming loan first — it can mean easier qualifying without jumbo's stricter reserve rules.
Jumbo Loans: pros and cons
Pros
Finances luxury and high-cost-area homes in one loan
No mortgage insurance often required with 20% down
Competitive rates for well-qualified borrowers
Flexible terms since lenders keep the loan in-house
Cons
Higher credit score and cash reserve requirements
Larger down payment typically expected
Fewer lenders offer them than conforming loans
Stricter income and asset documentation
Requirements at a glance
Credit score of 700 or higher at most lenders
10-20% down payment, sometimes more on larger loan amounts
Cash reserves covering several months of mortgage payments
Full income and asset documentation, typically two years' worth
Two appraisals required by some lenders on larger loans
Loan amount above the conforming limit for your county
Size — a jumbo loan is any mortgage above the conforming loan limit that Fannie Mae and Freddie Mac can purchase. Because those agencies won't buy it, the lender holds the loan itself and applies its own, generally stricter, underwriting rules.
Do jumbo loans always have higher interest rates?
Not always. Jumbo rates once ran well above conforming rates but now often track close to them, sometimes lower for strong borrowers with an existing bank relationship. Pricing varies more by lender than by loan type, so shopping multiple banks matters.
What credit score do I need for a jumbo loan?
Most lenders want 700 or higher, and some push that floor to 720 for the largest loan amounts. A few private banks will go lower for borrowers with substantial reserves and a strong deposit relationship.
Is $600000 a jumbo loan?
It depends entirely on where the property is. Most U.S. counties have a conforming loan limit well above $600,000, so a loan that size is typically conventional there, not jumbo.
In high-cost counties with higher limits, $600,000 stays conforming too — jumbo status only kicks in once you exceed your specific county's limit.
Do you have to put 20% down on a jumbo loan?
No — many jumbo lenders now accept 10-15% down, and some go lower for borrowers with strong credit and reserves, though 20% is still common and often gets you the best pricing.
Because jumbo loans stay on the lender's own books, down payment minimums vary more by lender than with conforming loans.
What salary do you need for a $500000 mortgage?
There's no fixed salary requirement — it comes down to your debt-to-income ratio, down payment, and the rate you lock, not a flat income cutoff.
Lenders generally want your total monthly debts, including the new mortgage, to stay under roughly 43-45% of gross income. html">mortgage calculator to model your own numbers.
This guide is general information, not a lending decision. Program rules and dollar limits change — verify current figures with a licensed lender and confirm licensing at NMLS Consumer Access. See all loan types.
No calculator matches that. Try “refinance”, “FHA”, “HELOC” or “amortization”.