From time to time I receive calls from individual wanting to know the difference between a Jumbo and a Conforming mortgage. The answer varies according to the number of units.
A jumbo mortgage is:
1. One unit: mortgage greater than $417,000
2. Two units: mortgage greater than $533,850
3. Three units: mortgage greater than $645,000
4. Four units: mortgage greater than $801,950
A conforming mortgage is the opposite of a jumbo.
Jumbo and conforming refer to the maximum loan, NOT PRICE, for a given property size in terms of units, not of property type: a one unit property can be a condominium, townhouse, single family detached, co-op unit...with 700 square feet or 10,000 square feet...
Jumbo loans are cost more than Conforming (less than the above) mortgages sue to the perceived risk associated with each type.
Certain markets have more jumbo loans than others, e.g. California has more jumbo loans than Wisconsin or Arkansas!
Finally, Jumbo and Conforming limits are revised every year and they cover the whole USA: YOU DOT HAVE EAST COAST, WEST COAST, CENTRAL, SOUTH OR PACIFIC Conforming or JUMBOS.
I hope that you learned something new today!
Send your comments to: info@p2funding.com
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