If you find yourself considering the purchases of a home that exceeds the local loan limit for mortgages will have to be covered under what is referred to as jumbo mortgage loans. One of the most popular types is none other than 15-year fixed jumbo mortgage loans.
Like fixed mortgages, the interest rate stays the same for the life of the loan (in this case that would be for 15 years). If you want a quick payoff, guaranteed interest rate, and the ability to fund the purchase of a more expensive home, this is one of the best ways to go about it.
How 15 Year Fixed Jumbo Mortgage Loans Work
The Federal Housing Finance Authority sets guidelines for each county to determine when a jumbo mortgage loan must be used because loan limits for traditional home loans can’t cover the financing. Since these types of mortgage loans can’t be covered by a government-sponsored lender, the risk tends to be higher.
In order to help offset this risk, lenders tend to have a stricter approval process as this means that is taking a complete loss if the borrower doesn’t pay their loan off. However, 15 year fixed jumbo mortgage loans still provide the opportunity for borrows to embrace the advantages of a fixed rate and timeline of 15 years to pay it off.
The Advantages of a 15 Year Jumbo Mortgage
While jumbo mortgage loans can be a little bit more difficult to get your hands on, it still comes with a set of advantages that makes it ideal for borrowers such as:
· 15 years to pay off the home loan instead of the normal 30.
Most lenders love locking their customers into 30-year terms, as it provides them with the ability to earn more off of the money they lent out. Instead of falling for that, you will be able to ensure your monthly payments ensure a payoff within 15 years.
· A fixed interest rate throughout the life of the loan.
This means that your interest rate is locked in for as long as you stay current on your payments which ensures that you don’t become a victim of rising costs in housing.
· The ability to be financed for a larger amount than traditional mortgages.
While traditional mortgages do have a limit as to how much you can be financed for, it’s known for jumbo mortgages loans to reach all the way up into millions. Sure you will have a lot more to pay off, but it doesn’t limit the possibilities.
This is the more difficult path to take, but as they say nothing good in life really comes easy. It provides a higher mortgage amount with a fixed rate that you don’t have to worry about taking you out financially.