A VA jumbo loan allows eligible borrowers to secure a mortgage above conventional conforming loan limits while still enjoying the benefits of a VA home loan. With a VA jumbo, you can purchase a more expensive home without having to meet the stricter requirements of a conventional jumbo loan.
In this comprehensive guide, we’ll explain everything you need to know about VA jumbo loans, including:
- What is a jumbo loan?
- VA jumbo loan limits
- Benefits of a VA jumbo
- Down payment requirements
- Credit score requirements
- How to get a VA jumbo loan
What is a Jumbo Loan?
First let’s clarify what makes a loan a “jumbo.”
Jumbo loans are mortgages that exceed the conforming loan limits set by the Federal Housing Finance Agency (FHFA) each year. The conforming loan limit refers to the maximum mortgage amount that can be purchased by government-sponsored enterprises Fannie Mae and Freddie Mac.
For 2024, the baseline conforming loan limit for a single-family home is $726,200 However, the limit is higher in certain high-cost areas, going up to $1,089,300.
A loan amount above the conforming limit for your county is considered a jumbo loan. These are non-conforming loans that cannot be purchased by Fannie and Freddie.
Jumbo loans usually have stricter eligibility requirements compared to conforming loans. Borrowers often need excellent credit, low debt-to-income ratios, and a down payment of 10-20% or more. Interest rates may also be higher.
VA Jumbo Loan Limits
The Department of Veterans Affairs (VA) does not set its own limits on how much veterans can borrow. Instead VA jumbo loans adhere to the conforming loan limits set by the FHFA.
So if the conforming limit in your county is $726,200, a loan above that amount would be considered a VA jumbo.
The good news is there is no maximum loan amount for a VA jumbo. How much you can borrow depends on what the lender is willing to approve based on your financial situation. VA jumbo loans up to $2 million are possible depending on the lender.
One important caveat is that VA entitlement can come into play if you have used your VA home loan benefit before. We’ll discuss this more below.
Benefits of a VA Jumbo
The main benefit of a VA jumbo is that you can purchase a higher-priced home while still enjoying the advantages of a regular VA loan.
No down payment – Veterans with full VA entitlement can get a VA jumbo with 0% down for loan amounts up to $1.5 million. Above that amount, a down payment may be required.
More flexible credit requirements – VA jumbos allow higher debt-to-income ratios and lower credit scores than conventional jumbos. Minimum scores generally start around 620.
No mortgage insurance – There is no private mortgage insurance (PMI) required on a VA jumbo. The VA funding fee takes the place of PMI.
Lower rates – Interest rates on VA jumbos may be lower than rates on conventional jumbos. VA loans in general offer very competitive rates.
Being able to get a jumbo loan with little to no money down can greatly expand your home buying possibilities and allow you to purchase more house for your money.
VA Jumbo Down Payment Requirements
Whether you need a down payment depends primarily on your available VA entitlement.
Entitlement refers to the amount of your VA home loan benefit you have remaining. It is generally equal to 25% of the county loan limit, up to $104,250 in 2024.
If this is your first time using a VA loan, you likely have full entitlement available. In that case:
- 0% down payment required for loan amounts up to $1.5 million
- 10% down payment required for loan amounts from $1.5 million to $2 million
If you have used your VA benefit before, you may only have partial entitlement left. The less entitlement you have, the lower the no-down-payment limit becomes.
Veterans with partial entitlement may need to make a down payment in order to keep their monthly payments within an affordable range. Lenders can advise you on down payment requirements based on your specific situation.
VA Jumbo Credit Score Requirements
To qualify for a VA jumbo, most lenders look for a minimum credit score of 620-640. The higher your score, the better your chances of approval on a jumbo loan.
Here are general credit score guidelines:
- ** scores:** Little to no down payment required in most cases
- Good scores (660-719): May qualify for 0% down up to conforming limits
- Average scores (620-659): May need 5-10% down payment
Other credit requirements are similar to a regular VA loan, including:
- 2 years since bankruptcy/foreclosure
- Limits on collections and charge-offs
- Stable income and employment
Debt-to-income ratios may need to be lower than on a standard VA loan, so minimizing monthly debts can help strengthen your VA jumbo loan application.
How to Get a VA Jumbo Loan
The process of getting a VA jumbo is very similar to a regular VA loan, just with the additional credit and income verifications needed for a larger loan amount. Here are the basic steps:
1. Check your VA entitlement
Confirm you have full entitlement available. This determines if you’ll need a down payment.
2. Check your credit
Aim for at least a 660 FICO score before applying. Pay down balances, check reports for errors.
3. Get pre-approved
Apply with lenders that offer VA jumbo loans. Compare rates and fees.
4. Find a home
Work with a real estate agent to identify homes in your price range.
5. Make an offer
Make an offer once you’ve found the right home. Do not start house hunting until you are pre-approved.
6. Final loan approval
Provide all required documents for underwriting once your offer is accepted.
7. Close on your home
Schedule your closing once final approval comes through.
As you can see, VA jumbos offer big purchasing power. If you need more home than what standard loan limits allow, be sure to explore this option. Connect with lenders that offer VA jumbo loans to review eligibility and get pre-approved today.
Jumbo loan FAQ Frequently Asked Questions
Jumbo loans are typically used when youre buying a home and financing more than $766,550. If youre buying in a high-cost area like Los Angeles or New York City, a high-balance conforming loan may better suit your needs. Give us a call at 800-531-0341 and well help you figure which loan works for you.
If you are buying in a high-cost area, you may be eligible for a conforming loan. Call 800-531-0341 to speak with a loan officer and learn more about your options.
Call 800-531-0341 to speak with a loan officer. Theyll help you start your application and walk you through the rest of the mortgage process.
The primary difference with jumbo loans is the amount being financed. The rest of the mortgage process is very similar, and were here to guide you through every step.
VA benefits reduce the amount of your down payment depending on your entitlement. Borrowers with full VA entitlement may be eligible for $0 down payment on a purchase price of up to $1.5 million. A down payment may be required for borrowers with partial entitlement.
Features for VA jumbo loans
- Loan Amounts Up to $3 Million
- No Private Mortgage Insurance (PMI)
- Personalized Service From Start to Finish
How Veterans can use VA Jumbo Loans for Luxury Homes (updated 2023)
FAQ
How hard is it to get a VA Jumbo loan?
What qualifies as a jumbo?
Can I get a 2 million dollar VA loan?
Can I buy a million dollar home with a VA loan?
Are there any advantages to getting a VA jumbo loan?
VA jumbo loans offer veterans and military buyers significant benefits, especially compared to the conventional jumbo landscape. With a VA jumbo loan, homebuyers have increased access to homes in high-cost metro areas, while utilizing their VA loan benefits – including the flagship $0 down.
What is the maximum amount I can borrow with a VA jumbo loan?
Mortgage loans that exceed the limits established by the Federal Housing Finance Agency (FHFA) are defined as jumbo loans. According to the 2022 rules, the VA jumbo loan limit for most counties is $647,200, while it can reach up to $970,800 in other high-cost states. However, regardless of the limit, you can borrow any amount you may qualify for.
Are VA jumbo loans more expensive than other loans?
VA jumbo rates are generally higher than loans under the conforming loan limit. Even with the VA guarantee, jumbo loans carry additional risk to the lender, which is the cause for typically higher rates. That said, VA loan rates are still typically lower than conventional and FHA rates.
How do I qualify for a VA jumbo loan?
Credit requirements vary by lender, but borrowers should expect to have a 620 mortgage credit score or higher to obtain VA jumbo loan financing. At Veterans United, our credit score minimum for VA jumbo loans is the same as a conforming loan unless you’re buying above $1 million.