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Jumbo Loan


A Jumbo Loan, in the context of VA benefits, is a mortgage that exceeds the conforming loan limits set by the Federal Housing Finance Agency (FHFA). These loans typically require higher down payments and stricter underwriting standards due to their larger amount. Although VA loans generally do not have a maximum loan limit, Jumbo Loans may require additional approval and documentation for veterans to secure financing for higher-priced homes.

Key Takeaways

  1. A Jumbo Loan is a mortgage that exceeds the conforming loan limits set by the Federal Housing Finance Agency, facilitating the purchase of higher-priced properties.
  2. VA Jumbo Loans follow the same basic guidelines as regular VA loans but typically require a higher credit score and may have somewhat stricter underwriting requirements, such as a lower debt-to-income ratio.
  3. Although VA Jumbo Loans don’t require a down payment, they may require a down payment in cases where the loan amount surpasses the county’s loan limit, usually calculated as a percentage of the difference between the limit and the loan amount.


The VA benefits term “Jumbo Loan” is important because it refers to a mortgage loan that exceeds the conforming loan limits set by the Federal Housing Finance Agency (FHFA). For veterans and service members, VA Jumbo Loans provide an opportunity to secure financing for homes with a higher price, while enjoying the benefits of the VA home loan program, such as no down payment or private mortgage insurance requirement, relaxed credit standards, and competitive interest rates.

This enables eligible borrowers to purchase a more expensive property that meets their needs and preferences, utilizing the valuable benefits they have earned through their service to the country.


The main purpose of a Jumbo Loan within the realm of VA benefits is to accommodate the needs of veterans and service members who wish to secure financing for homes priced higher than the county’s standard conforming loan limits. Typically, conventional mortgages in the United States have limits set by Fannie Mae and Freddie Mac, and any loan above this limit is referred to as a “jumbo” loan.

However, veterans and active-duty military personnel often seek to access homeownership in higher-cost areas, and the VA Jumbo Loan allows them to do so without the restrictions they may face with traditional financing options. These loans enable eligible borrowers to acquire their dream homes, while still reaping the benefits provided by the VA loan program.

The VA Jumbo Loan is designed to offer competitive interest rates and more flexible terms, even if the home’s value surpasses the conforming loan limits. In comparison to regular jumbo loans, which may require a sizable down payment and a higher credit score, VA Jumbo Loans can potentially save borrowers thousands of dollars, as they do not mandate Private Mortgage Insurance (PMI), have reduced down payment requirements, and have comparatively lower interest rates.

These unique provisions are designed to cater to the financial circumstances of veterans and active-duty military personnel, while appreciating the sacrifices they have made for our nation by providing them with accessible mortgage solutions.

Examples of Jumbo Loan

A Jumbo Loan, also known as a non-conforming loan, is a type of home mortgage whose amount exceeds the limits set by the Federal Housing Finance Agency (FHFA), and, as a result, cannot be obtained through government-sponsored home mortgage programs (Fannie Mae or Freddie Mac).Here are three real-world examples related to the VA Benefits term Jumbo Loan:

Veteran’s Jumbo Loan in California: In California, housing prices tend to be higher than in many other parts of the United States. A veteran purchasing a home in San Francisco may require a jumbo loan to finance the home if it exceeds the loan limit set by the FHFA. A VA jumbo loan would allow the veteran to obtain the necessary financing while still benefiting from lower interest rates and the absence of a down payment requirement that is usually required for traditional jumbo loans.

VA Jumbo Loan for High-End Properties: A veteran might be interested in purchasing a luxury home in an upscale neighborhood in Miami, Florida. The property’s cost might exceed the conforming loan limit for the area, requiring the veteran to seek additional financing through a jumbo loan. With a VA jumbo loan, the veteran can secure financing for their dream home and benefit from the unique advantages offered through VA lending.

Refinancing with a VA Jumbo Loan: A veteran homeowner, who initially financed their home purchase with a traditional jumbo loan, might decide to refinance with a VA jumbo loan to get better terms. The VA jumbo loan often comes with lower interest rates, allowing the homeowner to save money over time. Moreover, in many cases, the homeowner does not need to make a down payment when refinancing with a VA jumbo loan, providing another financial benefit to the veteran.

VA Jumbo Loan FAQs

What is a VA Jumbo Loan?

A VA Jumbo Loan is a mortgage option for eligible veterans, active-duty personnel, and surviving spouses to finance a home that exceeds the typical conforming loan limit set by the Federal Housing Finance Agency (FHFA). These loans allow borrowers to buy or refinance a higher-priced property using their VA loan benefits.

How does a VA Jumbo Loan differ from a regular VA Loan?

The primary difference between a VA Jumbo Loan and a regular VA Loan is the loan limit. VA Loans conform to the loan limits set by the FHFA, while VA Jumbo Loans allow for financing beyond those limits. This means that borrowers can apply for larger loan amounts using a VA Jumbo Loan without having to meet the stricter requirements usually associated with non-conforming loans.

What are the eligibility requirements for a VA Jumbo Loan?

Eligibility requirements for a VA Jumbo Loan are generally the same as for a regular VA Loan. The applicants must meet the military service or surviving spouse requirements set by the VA, have a valid Certificate of Eligibility, and pass the lender’s credit and income criteria. Additionally, VA Jumbo Loans may also require a higher credit score and a lower debt-to-income ratio compared to regular VA Loans, but this may vary from lender to lender.

Do VA Jumbo Loans require a down payment?

While regular VA Loans typically do not require a down payment, VA Jumbo Loans may require one. The need for a down payment depends on the difference between the loan amount and the county-specific VA loan limit. A down payment is usually required for the amount exceeding the loan limit. However, compared to conventional jumbo loans, the down payment for VA Jumbo Loans tends to be considerably lower.

What is the interest rate for VA Jumbo Loans?

Interest rates for VA Jumbo Loans may vary from lender to lender and can be influenced by factors such as credit score, loan amount, loan term, and current market rates. Generally, VA Jumbo Loan interest rates tend to be competitive and often lower than those for conventional jumbo loans, as they are backed by the VA.

Related VA Benefit Terms

  • Loan Limit
  • Conforming Loan
  • Veterans Affairs (VA) Guaranty
  • Interest Rate Reduction Refinance Loan (IRRRL)
  • VA Funding Fee

Sources for More Information