Super Conforming and Jumbo Refinance

NationsChoice Mortgage Super Conforming and Jumbo Refinance

Mortgage providers like Fannie Mae and Freddie Mac have set limits on the amount they will lend for home refinancing. In the past few years, these two can offer conventional loans for approximately $417,000. Anything beyond that amount would be declined because of the high loan amount. However, this restraint can be an issue with the increased demand for bigger and nicer homes. For borrowers in this position, jumbo home refinance loans and super conforming refinance loans were created to fit the increasing need to lend on larger home purchases.

What is a Jumbo Refinance Loan

In the United States, a jumbo refinance mortgage is a loan above the conventional conforming loan limits. This standard is set by the two government-sponsored enterprises Fannie Mae and Freddie Mac, and sets the limit on the maximum value of any individual mortgage they will purchase from a lender. Fannie Mae (FNMA) and Freddie Mac (FHLMC) are large agencies that purchase the bulk of U.S. residential mortgages from banks and other lenders, allowing them to free up liquidity to lend more mortgages. When the set limits don't cover the full loan amount, the loan is referred to as a "jumbo mortgage refinance".

For example, if we considered $417,000 the conventional conforming limits, and your home loan requirements are lower than this standard, then it would be considered a super conforming loan. If your loan requirements exceed that amount then you are in the jumbo loan bracket.

What is a Super Conforming Refinance Loan

A super conforming refinance loan is a mortgage option created by Fannie Mae and Freddie Mac for mortgages in certain parts of the country that are more expensive areas to live. Fannie and Freddie Mac have a mortgage limit of $417,000 in most parts of the country, and anything above that figure they will not be borrowed because it is considered a jumbo loan. Because of the appreciation in home values, certain areas can now apply for loans up to $625,000 and even $729,000 because of the high cost of homes.

This is a great alternative to a jumbo refinance loan if you meet the necessary qualifications. To find out more information and to see if this refinance option applies to you, contact NationsChoice Mortgage lending experts.

Other Refinance Variations

In between the conforming and jumbo loans, you will find the Jumbo Conforming refinance loans. This is a hybrid loan that can also be called conforming jumbos. The limits of these loans are higher than the conventional loans set by Fannie Mae and Freddie Mac so the interest rates may increase by up to 1% compared to the conventional loans. The guidelines are similar to how one would get conforming loans but with slightly higher interest rates.

Qualifying for the Jumbo refinance and Super Conforming Refinance Loans

The lending qualifications can vary depending on the financial institution as well as the financial situation of the borrower. The following qualifications are provided as an example for common guidelines but will vary depending on which lender you choose.

  • The home that you want to refinance may require more than 1 appraisal because of the uniqueness of the home and inability to compare other comps. This depends on the size of the home, location, as well as value of the property.
  • When refinancing, the appraisal value should be high enough that you can meet the limits or alternatively you can provide a premium to pay your balances down.
  • You may have to show that you have at least 6 month reserve of mortgage payment assets or enough money to pay the mortgage for half a year. This is proof that you have sufficient funds to pay for the debt. In super conforming loans, normally, this is not necessary, but could be requested especially for investment property purchases.

A lender wants to ensure that everything is clear and thorough because of the liability for providing a million dollar refinance loan. Prepare all financial documentation, and make sure that they are updated, free from errors and are verifiable. Make sure that you also have fixed any financial responsibilities. You want to ensure that you have very little debt and that you have money to pay for the necessary costs that may be required as a reserve.

Comparisons between Jumbo refinance and Super Conforming Refinance Loans

Depending on your situation and ability to qualify for either of these loans, you may want to consider some of the following characteristics that make each of these loans unique. The following comparisons may change depending on your situation or the lender you choose.

  • Often with a jumbo refinance loan, you need to have a very good to excellent credit rating, from a minimum of 700 and up. In super conforming loans, you often can obtain a refinance loan with a credit score of 600.
  • Compared to super conforming refinance loans, jumbo refinance loans are more flexible since there are more options and products to choose from.
  • Although the super conforming loans tend to be slightly more limiting, the tradeoff is often a better interest rate. Borrowers who plan to get a jumbo refinance loan may have slightly higher interest rates since these types of loans can be considered riskier investments and are not backed by the government.
  • In conforming loans, it is possible to borrow money from the refinance but with jumbo loans, the loan to value limits are set at around seventy per cent to eighty per cent of the home value so you have to pay from twenty to thirty per cent as a down payment.

Super Conforming and Jumbo Refinance Conclusion

Like any large investment there are many options to consider. Is this a good investment? Do you have a stable career or business? Will refinancing save you money each year? Before refinancing your existing loan, try using our mortgage calculator to calculate the monthly cost that you have to pay for the home. This invaluable tool can be used to answer many of your questions. Also speak to a NationsChoice Mortgage loan specialist. Their trained mortgage staff is well educated on finding the best option for your situation.

How to get a Super Conforming or Jumbo Refinance Loan:

If you are looking for a Super Conforming or Jumbo loan to refinance your existing mortgage, Nations Choice Mortgage can help you begin the process of applying for a loan. Nations Choice Mortgage has a well-trained team of mortgage specialists that are always available to help you make the best decision with your mortgage-related needs. We understand that choosing the right type of mortgage for your needs is a big decision and we are always here to help you make an informed choice.

To begin applying for a fixed rate refinance mortgage all you need to do is search rates and you will receive a personalized interest rate quote. You can then choose the type of loan and interest rate which fits your needs best. Your mortgage application can also be completed online using our advanced online mortgage application. If you have questions anytime during the online application process, feel free to contact us and we will provide you with all the information you need.

Instant Mortgage Rate Help

Loan Amount: How much do you want to borrow? Example: 150,000 (You can borrow up to 100% of the purchase price of your home. You will find better interest rates at 95%, 90%, and 80% progressively.)

Property Value: This is the purchase price of your property or your best estimate of the appraised value of the property. Example: 175,000.

Loan Type: Selecting Refinance WITH CASH OUT may increase your rate. If you want some extra cash to pay the closing costs on your new loan, this would NOT be considered receiving extra cash.

Escrow/Impounds: Allows you to pay 1/12 of your annual property taxes and homeowners insurance with your mortgage payment each month. Escrowing your taxes and insurance will lower your points by .25%

Property State: Specify the State where the property is located

Property County: Specify the County where the property is located

Todays Rates: These rates are based on the following criteria..

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