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For higher-priced areas, it may be necessary to utilize a jumbo loan to purchase a home. Jumbo loan amounts start at $1 above the FHFA County Loan limits. In Honolulu, that is a loan amount over $726,525.
Since jumbo loans cannot be sold off to FNMA or FHLMC, it presents a greater risk to the lender, and therefore the rate is typically higher, and the requirements to qualify are typically stricter.
It's important to note here that there are dozens of different jumbo loan programs with multiple lenders. The information herein is meant to be a general description. For information specific to your scenario, please contact me directly.
Most lenders will require a 20% down payment to ensure borrowers who utilize jumbo loans share some of the risk. However, there are lenders that will allow up to a 5% down payment.
Typically lenders will have a max Debt-to-Income ratio of 43%. However, certain loan programs will allow up to 55% DTI.
For Cash Out Refinances, typically the maximum cash proceeds allowed to the borrower cannot exceed $500,000.