Jumbo Loans in Omaha

Are you on the hunt for your dream home?

Before getting carried away, it's important to decide which type of mortgage is best. If your looking for a luxury home, then a jumbo mortgage could be the way to go. 

Jumbo mortgages are large loans that exceed federal limits and may come with higher interest rates than conventional mortgages do.

Although they’re harder to qualify for, these types of loans give borrowers the financial means needed to purchase expensive homes.

Difference Between Jumbo Loans and Conforming Loans?

From tiny to jumbo, and from high-interest and low-interest, mortgages come in all forms.

Although there are many different varieties of home loans, there are two main types: conforming (conventional, NIFA, VA, FHA) and non-conforming (such as jumbo).

To understand the distinction between these two loan options, let's review the federal loan limits set by the Federal Housing Finance Agency.

Mortgages that meet or fall below this predetermined amount will be labeled as conforming, while those exceeding it are considered non-conforming/jumbo mortgages. 

The government works with Fannie Mae and Freddie Mac to purchase conforming loans, which makes them less risky for lenders to issue, since they know their money is secure if something goes wrong with a borrower's payments. 

But what happens when you need a house that costs more than the limit?

Some lenders offer jumbo mortgage solutions, which are non-conventional loans used for homes costing more than what’s allowed under the FHFA threshold.

However, remember they're not typically backed or insured by any other entity, so they can be riskier investments on behalf of banks offering them. Every lender has its own guidelines when it comes to issuing such mortgages, so make sure you do your research before taking one out!

Current Jumbo Loan Limit in Omaha

A loan is considered jumbo if the loan amount exceeds $726,200 for a single-family home in Omaha and surrounding areas.

My Preferred Jumbo Loan Lenders in Omaha

How To Qualify for a Jumbo Loan

Qualifying for a jumbo loan is a process similar to that of getting an ordinary conforming loan.

However, there are several differences. Lenders generally require higher qualifications due to the extra risk involved with these loans. 

Credit Score

Your credit score is a major factor when determining eligibility for both regular and jumbo mortgages. If you want to be approved for a jumbo loan, having an excellent credit rating will give you the best chance of success. 

Reserves

Lenders assess your financial reserves as part of their approval process for jumbo loans, since they provide extra assurance against defaults. 

Down Payment

To secure either type of mortgage, putting down a substantial amount of cash upfront is essential, with larger amounts typically being required on jumbos compared to conforming loans. Generally speaking, lenders will expect at least 20% towards the value of the home.  

Income

Having enough income to cover repayment costs is also key when applying for any sort of mortgage; however, this becomes even more important with jumbo loans. 

Debt-to-Income Ratio (DTI)

When considering whether someone can afford repayments on their home loan, creditors always look at an individual’s DTI ratio. This is a comparison of the amount of debt someone already has compared to their income. Requirements vary between different lenders, but often stricter standards must be met when taking out a jumbo loan. Always talk to the lender about what type of debt-to-income ratio is required for their specific jumbo loan package.  

Mortgage Rates on Jumbo Loans

Taking out a jumbo mortgage doesn't always equate with higher interest rates. In fact, the opposite may be true in some cases. Jumbo loan rates can sometimes be lower than conforming mortgage rate options. It all depends on the lender and current market conditions, but many lenders offer competitive jumbo loan prices. 

Interest rates are influenced by more than just market trends; your credit score, down payment amount, cash assets, and income will also play a role in determining what kind of rate you receive when taking out a jumbo loan. 

The bottom line? Taking out a bigger mortgage doesn't mean accepting larger interest payments automatically; there's always the potential for lower costs depending on where you look!

Jumbo mortgages may be for you if: 

• You have significant cash reserves.  
• You live in an area with skyrocketing real estate values. 
• Your credit score is excellent  

Conforming mortgages might be better if: 

• Your real estate purchase stays under loan limits set by Fannie Mae and Freddie Mac. 
• Your credit score is not necessarily ideal.           
• You have a low or moderate income