Jumbo Loan
A jumbo loan is a mortgage that exceeds the conforming loan limit — the maximum size Fannie Mae and Freddie Mac are allowed to purchase. For 2026 the baseline limit is $832,750 for a single-family home, with higher ceilings (up to $1,249,125) in designated high-cost areas; the limit is adjusted annually.
Because a jumbo loan can't be sold to Fannie or Freddie, the lender carries more of the risk itself — and prices that risk in. Expect stricter requirements than for a conventional conforming loan: typically a credit score of 700+, a down payment of 10-20%, a lower debt-to-income ratio, and documented cash reserves covering several months of PITI payments.
Jumbo rates today are usually close to conforming rates — sometimes slightly higher, sometimes lower — but the bigger loan magnifies everything: rate differences, closing costs, and monthly payments.
Buyers near the limit sometimes make a larger down payment specifically to keep the loan conforming and avoid jumbo underwriting altogether.
Related terms: Conventional Loan, Down Payment, Debt-to-Income Ratio (DTI).
