Jumbo Loans in Tennessee
Are you house hunting for a five-bedroom chateau in Brentwood? Or are you looking for something more secluded, like a 100-acre retreat in Roan Mountain? Either way, you’ll need to borrow a big chunk of change to make your dream a reality.
When a prospective homeowner wants to invest in pricey real estate, they often need to secure a jumbo loan. These mortgages exceed lending limits set by the Federal Housing Finance Agency, allowing borrowers to buy properties that otherwise wouldn’t qualify for financing.
Ready to jump in? Getting qualified for a Tennessee jumbo loan is simple with Dash Home Loans!
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What Is a Jumbo Loan?
A jumbo loan is a mortgage for an amount that exceeds lending limits set by the Federal Housing Finance Agency. Unlike Tennessee conventional loans, jumbo mortgages can’t be secured by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation.
Some home buyers use jumbo loans to purchase stately mansions or houses on large tracts of land. But, as the housing market continues to run red-hot, more borrowers are using jumbo loans to purchase homes in sought-after areas like Signal Mountain and Franklin.
The only downside? Jumbo loans can be pretty hard to qualify for. They also tend to carry higher interest rates than conventional loans.
Jumbo Mortgage Limits for TN Homebuyers
Whether or not you need to secure a jumbo mortgage depends on the conforming loan limits for your area. In most parts of Tennessee, the 2023 conforming lending limit is $647,200 for a single-family home. In pricier areas like Cannon and Wilson counties, that lending limit jumps to $694,600.
So, if your heart is set on an $875,000 mountain retreat in Flag Pond, a conforming loan won’t work. Instead, you’ll need to team up with a lender to see if you qualify for a jumbo loan in Tennessee.
Qualifying for a Jumbo Loan in Tennessee
Jumbo loans are considered riskier for lenders because they can’t be guaranteed by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation. Because of this, lenders have pretty high eligibility standards. In Tennessee, borrowers must have:
- A down payment of at least 20%. Some mortgage lenders may let you put less down. If you do, be prepared to pay private mortgage insurance (PMI).
- A credit score of at least 680. But don’t be surprised if your lender requires a 700 or higher.
- A debt-to-income ratio of 45% or less. To calculate your DTI, divide your monthly debt expenses by your pre-tax income.
- An extra appraisal to make sure that the property is worth what you’re borrowing.
Not sure if you’ll qualify for a jumbo loan in Tennessee? Contact us today and we’ll pair you up with a Mortgage Coach who can guide you through the prequalification1 process.
Pros & Cons of Jumbo Loans
Jumbo loans have their advantages. Namely, if you qualify, you can purchase your dream home in that upscale suburb of Nashville. You could also use a jumbo loan to purchase an investment property in Tennessee, such as a vacation rental near Gatlinburg.
But since jumbo loans are riskier to lenders, they have fairly stringent eligibility requirements. If you do get approved for a jumbo loan in Tennessee, your lender may offer unfavorable loan terms (think: a super-high APR1).
How to Apply for a Jumbo Loan in TN
From Chattanooga to Memphis, mortgage lenders across the Volunteer State are making the home financing process unbearable. Why? Because big banks and credit unions just love to bombard prospective borrowers with loads of paperwork, unnecessary steps, and stressful deadlines.
But at Dash, we do mortgage lending differently. We’ve reimagined the lending process by nixing the middleman. Instead of dealing with slow, inefficient loan processors, we do all the work in-house. This keeps things moving really fast – like Bristol Motor Speedway fast.
Ready to hit the gas? Apply online using Dash’s user-friendly system. Once you hit “submit,” we’ll partner you with a Mortgage Coach who can answer all of your burning questions.
Documents & Paperwork to Submit
To apply for a jumbo loan in Tennessee, you’ll need to submit standard documentation. This includes:
- Proof of income from W2 and tax returns
- Proof of your debts to determine your debt-to-income ratio
- Paycheck stubs
- Bank statements
- A photo ID
- Other documents as requested by your Mortgage Coach
Timeline
Applying for a Tennessee jumbo loan should take 10 to 15 minutes, even faster if you gather all of your documentation ahead of time. From there, your lender will begin reviewing your information. Depending on your lender, this step could take three whole months.
If you think three months sounds like an insanely long wait time, we agree. That’s why at Dash Home Loans, we work to get prospective borrowers qualified in a hurry. This saves everyone a whole lot of nail-biting.
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Apply for a Jumbo Loan With Dash Today
Are you intimidated by the thought of applying for a jumbo loan in Tennessee? If so, give us a holler today. Our Mortgage Coaches can help you determine if this home financing tool is right for you.
Ready to get started? Awesome! Click “Apply now” below to start your application.
Frequently Asked Questions
Tennessee Jumbo Loan FAQs
What is a jumbo mortgage?
A jumbo loan is a home financing tool that’s used to purchase high-dollar properties that exceed lending limits set by the Federal Housing Finance Agency.
What is the limit for a jumbo loan?
In most parts of Tennessee, the conforming lending limit is $647,200 for 2022. However, in some counties, this limit increases to $694,600. These limits are set by the federal government and change annually.
Are jumbo loans bad?
Not necessarily. Though these mortgages can be risky, they can also make homeownership more attainable for borrowers in high-dollar areas.
Are jumbo loan rates higher?
Typically, yes. Since these loans can’t be guaranteed by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation, they generally have higher APRs than conventional mortgages.
Legal information
1 APR Disclaimer: Rate(s) quoted is/are based upon a (loan amount), (loan term, including whether fixed or ARM) year mortgage. Rates are subject to change and are subject to borrower(s) qualification.
2 Limited availability in some areas
3 Pre-Approval Disclaimer:
Pre-approvals are given to clients who have met qualifying approval criteria and specific loan requirements at the time of applications. Results may vary.
4 Government Sponsored Enterprise Disclaimer: The content in this marketing advertisement has not been approved, reviewed, sponsored or endorsed by any department or government agency.
5 VA Disclaimer: VA home loan purchases, have options for 0% down payment, No private mortgage Insurance requirements, competitive interest rates, with specific qualification requirements. VA Interest rate reduction loans (IRRRL) are only for Veterans who currently have a VA loan, current loan rate restrictions apply, and limits to recoupment of costs and fees apply. VA Cash-out Refinances are available for Veterans with or without current VA loans. Policies and guidelines may vary and are subject to the individual borrower(s) qualification. Program and Lender overlays apply.
6 No Down Payment Disclaimer: Closing costs and fees may still apply.
7 Dash Loan Closing Guarantee Disclaimer: Guarantee is based on loan closing; restrictions apply.
Jumbo Loans Disclaimer: † Limited availability in some areas.
