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Fannie Mae "High Balance Loan" Question

We were told that a $550K loan is considered a "high balance loan" through Fannie Mae and thus we would need at least 10% down. However, Rockland County of NY is a "high cost area" where the Fannie Mae website says the high balance loan limit is $625K. We don't understand what that $625K means? We thought it meant that because it was a high cost area anything up to $625 would not be considered a "high balance loan" and would be eligible for 5% down payment. by jenwed_746_872 from Ramapo, New York. Jul 5th 2012 Reply


William J Acres (William_Acres)
#73 ranked lender in Arizona - 8,727 contributions

Yes and No.. you are in a "High Cost Area" and Fannie does say they will insure that loan product, however the lenders who have the $$ can make up their own rules... and it looks like the lender you're dealing with is asking for 10%.. This is not uncommon, and you might find it difficult to find another lender willing to lend with only 5% down.. Your other option is to use FHA financing.. With FHA, you can go 3.5% down up to $759K loan amount. There is an Upfront MI premium (FHA will finance it) of 1% and there is a monthly mortgage insurance as well, but it would be comparable to what you would have paid if you can find a conventional lender willing to do 5% down. I think the mistake your making is you're probably dealing with the local bank.. so the best advice I can give you is to contact a LOCAL mortgage broker, not the local "Big" bank, and certainly not one of those 50 states internet lenders...By applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with numerous lenders, seeking out the best loan terms for your particular scenario. Because he has lower overhead, he can offer you lower rates and lower fees than most of the larger lenders.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Jul 5th 2012
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Peter Botros (PeterBotros)
#71 ranked lender in New York - 895 contributions

As others have said, any loan over $417,000 is considered high balance or "jumbo" in the mortgage industry. Many lenders require a larger percentage down payment along with higher credit scores. However, you do have options available to you starting from a 620 credit score and 3.5% down payment. We specialize in NY and NJ and I can meet with you to discuss your option. Call me at 908-933-0253 ask for Peter. Or you can call me on my cell 347-231-4444 email: pbotros@omegaloans.net

Jul 5th 2012
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Ken Burrows (mortgagesforamerica)
#19 ranked lender in Nevada - 572 contributions

Yes William is correct, a lot of lenders have their own internal overlays. We can go up to $625,000 as long as your county is stating that. Get into touch with me. 888-320-7888 - Ken

Jul 5th 2012
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Peter Traum (njlenderspeter)
#56 ranked lender in New Jersey - 16 contributions

H Jenwed. Anything over $417k, the long time max loan limit, is a high balance loan but you should be able to do less than 10% down. Call me on 973 983 5858 to discuss. We are in Montvale and lend in Rockland County and are very familiar with the area in which you are looking to buy and I can meet with you in person if you like. We are direct lenders and mortgage bankers and do not broker our loans meaning we make the underwriting decisions and approve the loans in our office. Thank you.Peter TraumNJ Lenders Corp.(973) 993-5858- office(973) 610-7642- cell

Jul 5th 2012
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Linda Wintersteen (Linda123)
#62 ranked lender in Arizona - 1,256 contributions

The $625 is what fannie mae states what the loan limit is for your county and state..The down payment will be regulated by your credit, and assets, that you have.. Every lender has their own overlays, and Fha might be a good idea

Jul 5th 2012
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