Preferred Mortgage, through a partnership with one of the largest wholesale lenders in the nation, has been selected to offer a new high balance Fannie Mae loan product to finance properties in Contra Costa, Alameda, Solano, and San Joaquin counties. Purchase prices in these high-cost areas typically exceed conventional loan limits, which often forces borrowers into jumbo loans.
For example, the conventional loan limit on a single family residence is currently $460,000 in Solano County, yet homes in some areas, such as Fairfield or Green Valley, often sell for between $800,000 and $1,000,000. Jumbo loans are one option many potential borrowers explore, but they come with higher interest rates, larger down payments, and hefty cash reserve requirements. Fannie Mae’s new high balance loan is a conventional loan, but with a higher limit. In Solano County, we can now go as high as $726,525.
Being in California means you are probably aware of Fannie Mae’s conventional loan limits and the associated challenges involved in getting financing for homes in higher cost areas. Deals often fall through because borrowers can’t meet the down payment or cash reserve requirements of a jumbo loan.
With the added flexibility of our high balance loans, you’ll be better equipped to help your clients purchase the homes they really want without having to compromise on neighborhood or price. Since our lending partner has worked out a deal directly with Fannie Mae, these high balance loans are currently not available from banks.
Most buyers cannot qualify for jumbo loans. For those who do, higher interest rates, higher down payments, and six-to-nine months’ cash reserve requirements make jumbo loans a costly choice. In fact, some lenders will require a full 12 months of cash reserves. Fannie Mae’s new high balance conventional loans are much easier for borrowers to qualify for and less costly. They’re also more flexible with credit scores, allowing scores as low as 620 instead of the typical 700 to 720 minimum scores required by many standard lenders.
DRE #01229793
NMLS #278063
Preferred Mortgage, Inc.
DRE #1979749
NMLS #1440176
