Non-conforming (Jumbo) Loans
A non-conforming home loan, or jumbo loan, is a loan that does not conform to the limits set by federal agencies like Freddie Mac and Fannie Mae. Non-conforming loans usually have higher interest rates and different downpayment requirements.
Non-conforming (jumbo) home loans work best for the following persons:
- A borrower with an unstable or variable income
- A borrower with a history of late payments, loan default, and/or bankruptcy
- A borrower that wants to borrow more than 90% of the property value
- Older borrowers
Non-conforming Fixed Rate Loan
A non-conforming fixed rate loan is a home loan that fails to meet conventional bank lending criteria. Once the lender determines the loan amount, you pay a fixed monthly payment for the term of the mortgage.
A non-conforming fixed rate loan is an excellent option for borrowers that don’t meet conventional bank lending criteria but that prefer to maintain a monthly budget.
Non-conforming Adjustable Rate Loan
A non-conforming adjustable rate mortgage (ARM) is a home loan that fails to meet conventional bank lending criteria. The monthly payments on this type of home loan fluctuate, depending on the market.
The benefit of a non-conforming adjustable rate loan is that you may end up paying a lower monthly amount if interests rates drop in the marketplace.
For more information about non-conforming (jumbo) mortgages, contact one of our friendly St. Louis mortgage experts.