As mentioned, jumbo loans generally have much stricter requirements because borrowers are being approved for a larger sum. Here are some of the most important jumbo loan requirements and qualifications to make note of:

• Credit Score: Jumbo mortgages are not designed for high-risk borrowers. Instead, they are restricted to those who are fiscally equipped to repay such a large sum. For this reason, a higher credit score may be required. In many cases, this would be a good or even excellent credit score (700 or above).For example, even with an FHA loan—which is typically designed for low-to-moderate income buyers—there are much stricter requirements. A traditional FHA allows borrowers to qualify with a credit score as low as 580. However, with an FHA jumbo loan your credit score must be higher (among other restrictions).
• Debt-to-Income Ratio: The debt-to-income ratio (DTIR) is the percentage of debt you have compared to your income. Typically, the lower your DTIR the better. Some traditional home loans may allow up to 55% DTIR, however, jumbo loan applicants will typically need theirs to be significantly lower. In many cases the required DTIR for jumbo mortgages must be lower than 43%—or sometimes even 36%.
• Cash Reserves In order to qualify for a jumbo mortgage, lenders typically want you to have substantial savings or liquid assets (that can be easily converted to cash)—this should usually be enough to cover several months or even a year’s worth of mortgage payments.
• Documentation of Financial Health Before approving your loan application, your lender will likely request your W2 tax forms and other documentation to verify your income and ensure you have substantial cash reserves. For those who are self-employed, this may be cause for concern as your total income is not always reflected through these types of financial documentation.However, at Griffin Funding, we can verify this information for self-employed borrowers using bank statements, for a more accurate reflection of your financial situation.
• Property Appraisal Before final loan approval on your jumbo home loan, you will typically need to schedule a property appraisal to confirm the value of the property and the soundness of the structure. For jumbo loans, you may also need a secondary appraisal. This is because jumbo loans are typically used to purchase luxury homes, which may be outside the scope of the standard.
  
• Down Payment How much is a jumbo loan down payment? Typically, a larger down payment will be required for jumbo loans because the lender is taking a larger risk by approving financing on a high-value property. A standard jumbo loan minimum down payment is 20%. However, down payment requirements vary based on personal financial circumstances, the cost of the home, and other loan terms. We do offer jumbo loans with a minimum down payment of 10% in some cases.