Jumbo loans can help you afford a more expensive house in a high-demand location. A jumbo loan is a mortgage that lets you finance a home purchase that surpasses the limits of a conventional loan, as set by the Federal Housing Finance Agency. For 2022, the conventional loan limit for a mortgage is $647,200 in most counties across the US. If you're taking on a home loan that's larger than this amount, you'll need a jumbo loan. 

Generally speaking, you need a higher credit score (usually 680 or above) and higher income (to ensure you can make payments) to qualify for a jumbo loan. Also called nonconforming loans, since they do not conform to FHFA limits, jumbo loans typically require a larger down payment. As a result of skyrocketing home prices over the last two years, the loan limit for a jumbo loan was raised to almost $1 million this year, and is now $970,800.    

What are jumbo mortgage rates?

Jumbo mortgage rates usually tend to be higher than conventional mortgage rates, since you're borrowing a larger amount. However, since rates began rising in early 2022, jumbo loans have had slightly lower rates than conventional loans. Right now, they are relatively close: The 30-year fixed-interest rate for a jumbo loan is in the low-to-mid 5% range, keeping in line with the national average for 30-year fixed-rate mortgages, and the national average APR for a 30-year fixed-rate jumbo loan is the same, hovering closer to 5.2%. If you're trying to purchase a home in a sought-after area with significant housing demand, it's likely you will need a jumbo loan.

Current jumbo mortgage rate trends

Mortgage interest rates had been consistently rising since the beginning of the year, but after the Federal Reserve's most recent interest rate hike in late July they dropped. Jumbo loan interest rates typically follow the same trend as mortgage rates -- and are usually even higher than conventional mortgage rates. But as a result of the housing frenzy during the pandemic and current state of the economy, jumbo loan interest rates are now in the same range as average 30-year mortgage rates. At the beginning of this year, 30-year jumbo interest rates were around 3% and have since risen to 5.2%.

How to get a jumbo mortgage

Credit requirements are stricter for jumbo mortgages since they are larger loans that require bigger down payments. You typically need a minimum credit score of 680 to qualify for a jumbo loan, although the required score varies by lender -- some lenders will accept a score as low as 660. 

You should also be prepared for a larger down payment when it comes to a jumbo loan: The minimum down payment requirement for a jumbo loan is 10%, compared with 3% for a conventional mortgage. In order to qualify for a jumbo loan, you need to have your financial life and documents ready to be evaluated by a lender, especially in a competitive housing market like the one we're experiencing now. 

• Have your finances in order: Gather financial documents like your W-2, pay stubs and bank statements for proof of income to show lenders you can afford the loan.
• Get prequalified for a mortgage: In order for a seller to take your offer seriously you have to verify your creditworthiness by going through the prequalified process (or the preapproval process, which takes it a step further and officially approves you for the loan).
• Make sure you have a credit score of at least 680: Pay off high-interest debt like credit card debt to raise your credit score, and make sure your debt-to-income ratio is low overall.
• Make sure you can afford a 10% down payment: At a minimum, you will be required to put down 10% for a jumbo loan.  

Current mortgage and refinance rates

We use information collected by Bankrate, which is owned by the same parent company as CNET, to track daily mortgage rate trends. The above table summarizes the average rates offered by lenders across the country.

Why should you compare jumbo mortgage rates?

Just as with any mortgage, shopping around with different lenders will help you secure the lowest rate possible. Comparing interest rates and fees between lenders allows you to see what the true cost of your loan will be. Getting quotes from numerous lenders will save you money: Interviewing just one additional lender can save you on average $1,500 over the lifetime of your loan, and speaking with five lenders can save you $3,000 on average over the course of your mortgage, according to Freddie Mac.

FAQs

More mortgage tools and resources 

You can use CNET's mortgage calculator to help you determine how much house you can afford. The CNET mortgage calculator factors in variables like the size of your down payment, home price and interest rate to help you figure out how large of mortgage you may be able to afford. Using the CNET mortgage calculator can also help you understand how much of a difference even a slight increase in rates makes in how much interest you'll pay over the lifetime of your loan.