Jumbo Mortgage in Florida: How to Finance a Home at Whitmore Estates

If you are buying at Whitmore Estates, you will most likely need a jumbo mortgage. A jumbo mortgage is a home loan that is bigger than the limit that government-backed lenders will buy. Homes in the Kensington Collection have recently started around $1.2 million and go up from there, and the standard limit in Palm Beach County has recently been in the low $800,000s. Even a large down payment may leave you above it.

This guide explains what a jumbo loan is, what lenders usually look at, and how to get ready. It is plain information, not financial advice. We are real estate agents, not lenders. A loan officer is the person who can give you real numbers.

What a jumbo loan is

Most home loans in the United States follow a size limit. The limit is set each year by the Federal Housing Finance Agency, or FHFA. Loans at or under the limit are called conforming loans. Loans above it are called jumbo loans. You can see the current limits on the FHFA conforming loan limit page.

The limit is the same in most counties and higher in a few expensive ones. Palm Beach County has recently sat at the standard level, not the high-cost level. Check the FHFA site for this year's number, because it changes.

The Consumer Financial Protection Bureau, a government agency, explains that jumbo loans can cost more than conforming loans. You can read its explainer at what is a jumbo loan.

Why Whitmore Estates buyers usually need one

Here is a simple example. Say a home costs $1.2 million and you put 20 percent down. That is 240 thousand dollars down and a loan of 960 thousand dollars. That is well over the low $800,000s limit.

To borrow less than the limit, you would need to put down roughly 30 percent or more. Some buyers do. Many do not. Plans above the Maxwell cost more, so the loan gets bigger from there.

This is only an example, not a quote. Prices change. Call 561-704-0091 for what homes have recently started at, then ask a lender to run your own numbers.

What lenders usually look at

Each lender sets its own rules. There is no one list. But most jumbo lenders look hard at the same four things.

1. Your credit. Jumbo lenders often want stronger credit than a standard loan needs. Ask the lender what they expect.

2. Your down payment. A bigger down payment is common with jumbo loans. Some lenders accept less, but it is worth asking early.

3. Your savings after closing. Lenders often want to see cash left over after you pay your down payment and closing costs. This is called reserves. It shows you can keep up the payments if life gets bumpy.

4. Your income and debt. The lender compares what you earn with what you owe each month. This is called your debt-to-income ratio. Lenders add up your monthly debts and divide by your monthly income, and each one has its own limit for that number. Ask what theirs is.

You will also need paperwork: pay stubs, tax returns, bank statements and more. Self-employed buyers usually need more of it. Start collecting it before you tour.

Where to get a jumbo loan

You have choices, and you should use them.

• Banks and credit unions. Many local and regional banks and credit unions offer jumbo loans, and some do their own underwriting.

• Mortgage brokers. A broker can shop several lenders for you.

• The builder's lender. Lennar lists Lennar Mortgage among its services. Whether to use it is your decision. It may have offers worth hearing. It is smart to get at least one quote from another lender so you can compare.

When you compare, look at the full cost: the interest rate, the fees, and any points. Points are fees you pay up front to lower your rate. Ask each lender for the same set of numbers so you can compare them side by side.

A word on rates and timing

We do not quote rates. They change often, and any number we wrote would be stale by the time you read it. What you can do is compare fairly. Ask each lender for a Loan Estimate, which is a standard three-page form that lenders must give you after you apply. It lays out the rate, the fees and the cash you need at closing in the same order every time, so two lenders are easy to compare. Ask for them on the same day, because rates move.

Timing matters on a new home too. If your home is not built yet, ask the builder how long a rate lock will need to last, and what happens to the lock if the closing date moves. Do not guess. Get the answer in writing.

Steps to get ready

1. Check your credit report a few months before you shop.

2. Gather your paperwork. Two years of tax returns, recent pay stubs and bank statements is a common list.

3. Get pre-approved. A pre-approval letter tells a seller or builder you are serious, and it tells you what you can afford.

4. Ask about a rate lock. A rate lock holds your rate for a set time. Ask how long, and what it costs.

5. Budget for closing costs. They are on top of the down payment.

6. Think about the whole monthly cost, not only the loan payment. Homeowners insurance in Florida is a big piece. Get an insurance quote early, because it affects what you can afford.

Property taxes and the homestead exemption

A big loan is only part of the monthly bill. Property taxes are another. In Florida, a primary home may qualify for a homestead exemption, which lowers the taxable value. The Palm Beach County Property Appraiser explains the rules on its homestead exemption page.

What a jumbo loan does not change

A jumbo loan does not change the home. You still choose a plan, you still get an inspection, and you still get the same warranty and feature list. To see what comes with the house, read what Lennar's Everything's Included means at Whitmore Estates. To see which plan fits your budget, start with all five Whitmore Estates plans compared. If you are still weighing whether to buy new at all, read new construction vs existing home in Palm Beach County. To learn what the gated community offers, read gated communities in Lake Worth, FL, and Whitmore Estates.

Common Questions

Ready to see what your budget buys? Call 561-704-0091 or See Whitmore Estates — Schedule a Visit. We will show you the plans and tell you what homes have recently started at. Then a lender can run your real numbers.