Your Guide to Jumbo Loans

What is a Jumbo Loan?

A Jumbo Loan is exactly what it sounds like—a larger loan. A Jumbo Loan is when the mortgage amount exceeds the loan limits set by Fannie Mae and Freddie Mac. These loans are used to cover larger home purchases that a traditional Conventional Loan won’t cover.

Learning as much as possible before making the weighted decision of taking out a Jumbo Loan is vital for protecting and managing your financial stability and success. Is a Jumbo Loan the right decision for you? Let’s take a closer look.

  • Minimum of 680 credit score
  • 5% down payment
  • Cash reserves for 6-12 months
  • Healthy debt-to-income ratio

Does a Jumbo Loan Make Sense for You?

Consider the following to aid in your decision of whether you should take your first step toward a jumbo loan or find an alternative.

Why Treadstone?

Aside from having the coolest mortgage staff on the planet…working with Treadstone on your mortgage in West Michigan gives you a distinct advantage in not only getting your offer accepted, but also in becoming a more successful and enlightened home owner.

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Michigan Jumbo Loan Interest Rates

Jumbo loan mortgage rates fluctuate daily based on several financial indicators and trends, just like gas prices. To get an up-to-date quote on real-time mortgage rates, tap the button below to get in touch!

Whether you need a Lender or a Realtor, we can help!

What are the Requirements for a Jumbo Loan?

As with any type of mortgage, there are set guidelines and requirements to meet to be approved for a Jumbo loan. Some of those requirements include a lower debt-to-income ratio, 6-12 months of reserves, and a higher credit score. Due to the larger loan size of the jumbo loan, there are some requirements to meet to successfully take out a jumbo loan. Those requirements include proving strong financial health through a high credit score, debt-to-income ratio, and cash reserves.

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FAQs About Jumbo Loans

An important factor to consider is the type of property you’re looking to use your Jumbo Loan for. Jumbo Loans are typically used on primary, secondary, and vacation homes, planned unit developments, condos, and 1-4 unit properties.

Due to the previously listed requirements, Jumbo Loans are typically considered to be a more thorough process to qualify for versus other loan types. Lenders need exceptional proof of the buyer’s financial stability due to the large loan amount. Because of this, Jumbo Loans require more proof and have a stricter qualification process due to the large loan amount and needed requirements such as a higher credit score, clean credit report, low debt-to-income ratio and cash reserves for 6-12 months.

The current Jumbo Loan rates for Michigan in 2023 include fixed and adjustable-rate mortgage (ARM) options. Adjustable-rate mortgage defines how long the rate stays fixed at the beginning of a loan period, but all ARMS come with 30-year repayment terms. As the graphic displays below, the rates for 30-yr conforming, FHA (Federal Housing Commission), VA (Veteran’s Affairs), and USDA (U.S. Department of Agriculture) are listed to give a general idea of current industry-wide interest rate trends.



*Displayed interest rates represent industry trends, and do not represent rates offered by Treadstone Funding or Neighborhood Loans. For an accurate, up-to-date quote on mortgage rates, please talk to a licensed Loan Officer.

The debt-to-income ratio is your monthly debt payments divided by your gross monthly income. In other words, the debt-to-income ratio compares how much you owe each month to how much you earn.


Having a higher percentage of debt in relation to your monthly income may decrease your likelihood of meeting the requirements for obtaining a Jumbo Loan. This is because lenders may view a higher debt-to-income ratio as a potential indicator of unreliability in making mortgage payments. On the other hand, if your credit score is not as high as previously suggested, a low debt-to-income ratio may be able to carry some of that weight to make up for your qualification.


Either way, it is best recommended to balance out your debt-to-income ratio as much as possible to surpass the Jumbo Loan qualifications fully and confidently.

Ready to go big and go home with a Jumbo Loan? The following steps can help you acquire your jumbo loan in Michigan.

With any home loan, a talking with a Loan Officer is often the first and only step to getting started.

1. Make sure you meet the Jumbo Loan Requirements

A minimum credit score of 680, along with a healthy debt-to-income ratio are essential to a smooth deal! Also, make sure you have a down payment of at least 5% of your purchase price, and an adequate nest egg for 6-12 months of cash reserves. For understanding more about your mortgage credit score, check out this Treadstone resource and the provided Treadstone article on tips for How To Improve Your Credit Score. To help further brainstorm your loan goals, use this Loan Goals worksheet with your Loan Officer to consider your home loan concerns and values.

2. Collect your documents

To submit an application, there are three major document types that we’ll need. Those are proof of income, assets, and identity. Everything from paystubs, to bank statements, to your drivers license will likely be requested by your Loan Officer when you first start the process.

3. Discuss Your Mortgage Options with Treadstone

Connect with one of our Loan Officers to help you review your financial status and make a plan! 

Your Loan Officer can also spot things that might not be obvious, like locked credit or income eligibility. If you fall short on any of the requirements, we’ll make a detailed plan to get you back on track. 

4. Submit an application 

Once you’re ready with a plan, you’ll need to submit an application! The easiest way to do this is online or over the phone. This way, we’ll be able to issue a pre-approval if you qualify. You can even start one now, if you’d like!

*Terms quoted are for illustrative purposes and are subject to change without notice. Please contact a Loan Officer for terms available to you.

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