Several factors determine the amount you can borrow, such as your assets, credit score, and the value of the property you plan to buy. Jumbo mortgages cater to high-income earners but do not have millions of extra cash or other accumulated assets. Here are some of the criteria for jumbo loans.
Credit score
Lenders will require your credit score to be 700 or higher, sometimes even 720.
Debt-to-income ratio
This is another factor that lenders consider. Some jumbo loan lenders will have a strict cap of 45%. This will ensure that you don’t become over-leveraged.
Cash in bank
When you have enough cash reserves, there is a higher chance of getting approved for a jumbo loan. This will show that you are capable of covering at least one year of mortgage payments.