What’s Considered a Super Jumbo Mortgage Loan in Washington?

January 19, 2023
Last updated:
January 19, 2023
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While researching the mortgage process, you might have encountered the terms “conforming” and” jumbo.” To further complicate matters, you might’ve heard about a super jumbo mortgage loan that’s available in Washington State. These terms tend to confuse home buyers, especially those who are new to the mortgage process. So let’s clear things up a bit.

Today, we will talk about the super jumbo mortgage loan in particular. We’ll cover the basic definition, borrower requirements, and other aspects of this “oversized” loan option.

What Is a Super Jumbo Mortgage in Washington State?

To understand the concept of a super jumbo mortgage loan, we must first address the difference between a conforming and jumbo loan. Here’s what these two terms mean, from a borrower’s perspective:

  • A conforming mortgage loan is one that meets the size requirements established by the Federal Housing Finance Agency. This is the federal agency that sets guidelines for Fannie Mae and Freddie Mac, the government-sponsored corporations that buy home loans from lenders. To put it simply, a “conforming” mortgage loan can be sold to Freddie Mac and Fannie Mae, because it meets their size limits and other purchase parameters.
  • A jumbo loan, as you might’ve guessed, is one that exceeds the conforming loan limit for a particular county of Washington State. In other words, if you borrow more than the conforming limit for your particular county, you have crossed over into jumbo mortgage “territory.” We’ll explain how this might affect you, as a borrower, in just a moment.

But what about the so-called super jumbo mortgage?

This is where things get a bit confusing, mainly because of the terminology being used here. There is a very specific definition of a conforming loan, as mentioned above. The same goes for a jumbo loan, which refers to any mortgage that exceeds the county-specific loan limit.

But there is no standardized definition for a super jumbo mortgage loan in Washington (or any other state for that matter). This is a general catchall term that typically refers to mortgage loans that exceed $1 million.

Here’s another way to think of it. A jumbo loan is when you borrow more than the conforming limit for your county. A super jumbo mortgage is when you borrow a lot more than that limit. So we are talking about loans in the $1 million – $3 million range, generally speaking.

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More Stringent Criteria for Borrowers

When it comes to the mortgage qualification and approval process, larger loans tend to have stricter requirements. There’s an obvious reason for this. A larger mortgage loan brings more risk into the picture, for both borrower and lender alike. As a result, mortgage lenders try to ensure that a borrower has a high likelihood of managing the monthly payments.

What does this have to do with super jumbo mortgage loans in Washington?

For one thing, it means that borrowers typically need to have a higher credit score to qualify for these loans. Credit histories and scores show how a person has borrowed and repaid money in the past. This is important for mortgage loans of all sizes, but especially for the super jumbo range since it brings a higher level of risk.

Additionally, borrowers seeking a super jumbo mortgage loan in Washington State might have to make a larger down payment, when compared to those seeking a conforming loan.

But for Washington home buyers who are purchasing multimillion-dollar properties, the advantages of using the super jumbo mortgage typically outweigh the disadvantages.

Without this kind of financing, some home buyers wouldn’t be able to purchase high-end properties, even if their income supported it. And that’s where the super jumbo mortgage loan comes in handy.

A Popular Product in the Seattle Metro Area

Super jumbo mortgage loans tend to be more popular in more expensive real estate markets. In such markets, there is a higher percentage of homes that exceed the $1 million threshold. So there are more home buyers seeking jumbo and super jumbo mortgage products.

In the Seattle metro area, for example, the current median home price is north of $900,000. That means there are many borrowers who will have to cross into jumbo mortgage territory to finance their purchases. Some of these borrowers might need funding of $1 million, $2 million or more. So they’ll have to rely on a super jumbo mortgage loan to accomplish their goals.

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Need a Home Loan for More Than $1 Million?

Located in the Seattle area, Sammamish Mortgage serves home buyers and homeowners all across the state of Washington. We offer a wide range of financing options to suit almost every need. This includes both conforming and jumbo mortgage loans.

If you find yourself in need of a “super” jumbo type of home loan, please contact our staff. We can review your current financial situation to determine how much you might be able to borrow.

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