Mini Jumbos – Lower Interest Rates, No Reserve Jumbo Loans

High Balance Loans in Non-High-Balance Areas

High balance loans have existed for a long time in states like California and New York, states where property values are high.  They come with higher interest rates than conforming conventional loans but, otherwise, they’re a lot like conforming conventional loan and not a lot like jumbo loans, though, technically, they are jumbos.

If you’re about to get a mortgage that’s higher than Fannie Mae’s limit by at least one dollar but less than $679,650, you might want to look for a lender that will treat your loan like a mini-jumbo (high-balance loan).

At this point, not all lenders offer such loans, hopefully they will all end up doing it.

The reasons to look for such a lender that offers mini-jumbo loans?

  1. Though higher than that of conventional loans, the interest rate of high-balance loans is lower than that of jumbo loans.
  2. They do not require you to have months and months of reserves.  (If the automated systems used to qualify you (DU) requires reserves, they’d be 3-months’ worth of PITI (principal, interest, taxes and insurance) not 9 or 12.  (If DU requires reserves for a particular borrowers applying for a mini-jumbo, it would require it for a conforming conventional too.)

Yes, qualifying for a mini-jumbo / high balance loan requires higher credit scores, but if you qualify you are ahead.