Jumbo Loan Underwriting: What You Should Expect

Jumbo loans are a critical part of the mortgage landscape, especially in high-cost housing markets. As of 2025, the jumbo loan limit is set at $806,500 in most areas of the United States, according to the Federal Housing Finance Agency (FHFA). This means any mortgage amount above this threshold is considered a jumbo mortgage, requiring manual underwriting and more stringent qualification standards.

In this post, we’ll break down what jumbo loan underwriting entails in 2025, what lenders look for, and how you can improve your chances of approval.

What Is a Jumbo Loan?

A jumbo loan is a type of non-conforming loan that exceeds the conforming loan limits established by Fannie Mae and Freddie Mac. In 2025, that threshold is $806,500 in most parts of the country, but it can be higher in high-cost areas.

Because jumbo loans fall outside conforming limits, they aren’t eligible for government backing, which means lenders take on more risk—and that’s where underwriting plays a key role.

Jumbo Loan Underwriting Requirements

Underwriting for jumbo loans is generally more detailed and conservative than for conventional loans.

Here are the core areas lenders will evaluate:

1. Credit Score

• Minimum credit score of 660 but for maximum financing, you will need a 740+ credit score.

2. Debt-to-Income Ratio (DTI)

• The maximum DTI is 45%, with exceptions up to 50% with strong compensating factors.

3. Income Documentation

• Full documentation required: W-2s, pay stubs, tax returns (2 years)

4. Assets & Reserves

• 3 months of reserves are required (principal, interest, taxes, and insurance—PITI)

• Higher reserves could be required based on loan purpose and amount

5. Loan-to-Value (LTV) Ratio

• Max LTV usually capped at 89.99%

• Higher loan amounts, property type and loan purpose may require loan loan-to-value ratios

Property Types Eligible for Jumbo Loans

• Primary residences

• Second homes

• Investment properties

• Luxury condos and multi-unit homes

However, underwriting can vary significantly based on the property type, location, and loan amount.

How to Prepare for Jumbo Loan Underwriting

Here are the steps you can take to strengthen your application:

• Boost your credit score by paying down debts and avoiding new credit lines

• Document your income and assets thoroughly

• Lower your DTI by paying off high-interest debt or increasing your income

• Save for reserves—the more liquid assets you can show, the better

• Work with a lender experienced in jumbo mortgage underwriting

  
  

Why Jumbo Loans Are Gaining Popularity in 2025

With rising home prices, especially in coastal and metropolitan areas, more buyers are turning to jumbo loans to finance homes that exceed the $806,500 conforming loan limit. Despite higher underwriting standards, today's competitive mortgage market means lenders are offering competitive jumbo loan rates for well-qualified borrowers.

Final Thoughts

Getting approved for a jumbo loan requires thorough preparation, especially due to the strict underwriting guidelines. Understanding the process, knowing what lenders look for, and preparing your financial profile can significantly increase your chances of approval.

If you're considering a jumbo mortgage, work with a trusted jumbo mortgage lender who specializes in high-value home financing to guide you through the underwriting process.

How I Can Help You

When it comes time to purchase a home or refinance an existing loan, I want to help you! Hopefully articles like this give you good information and a better understanding of the mortgage world but let me use my experience and expertise to help you with your particular situation.

I tell my clients and referral partners that a mortgage transaction starts with a simple conversation. Let’s talk about your financial situation, budget, and goals so that I can help you determine the best solution for you. During a 10-minute informal conversation, we can get you on the right path as it relates to a home purchase or mortgage refinance.