Jumbo VS Conventional Loans

When purchasing a home, you may be unaware of the several home financing options available to you. You'll quickly discover that you have access to a variety of government and non-government-backed loan choices once you start chatting with your financing company. Today, let's talk about two popular home loans: Jumbo and Conventional Loans.

What is a Jumbo Loan?Jumbo VS Conventional Loans

 States limited to $647,200 for a conventional home loan. When you go beyond these limits, you've entered the jumbo loan area.

A jumbo loan is meant for more expensive, higher-end homes that go beyond a normal loan's borrowing limits. The Federal Housing Finance Agency (FHFA) sets the conventional loan limit each year, with most of the United

When the price tag hits specific levels, you are no longer eligible for the typical loan protections provided. Because of this, a jumbo mortgage is also known as a non-conforming loan and can be granted as a fixed-rate or adjustable-rate mortgage.


  • Competitive interest rates
  • Fixed or variable interest rates
  • No private mortgage insurance (PMI)
  • Opportunity to Buy a Larger Home

What is a Conventional Loan?

The most frequent type of mortgage accessible is a conventional loan. They're generally provided by private mortgage lenders like banks or credit unions, and they're not federally insured. They are also known as "conforming" loans.

The overall amount of the loan and how it adheres to the FHFA rules determine conventional lending restrictions. A conforming loan's maximum amount is $647,200. This can climb in more costly places like Washington, DC, or New York.

Conventional loans typically have a term of 30 years. Within that range, however, there are some differences. Depending on the repayment plan, may last 15 or 20 years.


  • A conventional loan can be more flexible than a government-insured loan
  • As little as 3% down payment
  • A minimum credit score of 620
  • Rates are typically lower than FHA loans
  • Maximum debt-to-income ratio between 43%-50%


Private mortgage lenders provide both types of loans. The government does not insure conventional or jumbo loans, which distinguishes them from the Federal Housing Administration (FHA) or Veterans Affairs (VA) loans your bank may offer.

They both have specific financial qualifications as well. But, while all of thosefactors are taken into account by each loan type, each criterion has various values and limitations.

Which One is Better for You?

There isn't a single loan that is inherently better than the others. Everything is dependent on your unique circumstances and financial position. A conventional loan may be preferable for first-time buyers. A jumbo loan, on the other hand, can be a better alternative if you're trying to buy a luxury home or relocate into a competitive market. Consider your own financial situation and your loan eligibility while deciding which path to choose.

Amerifund provides a few loan options to choose from to meet your needs. Amerifund assists you in determining whether a jumbo loan or a conventional loan is better for your purchase. There are many factors to consider when you explore a jumbo loan vs a conventional loan, and Amerifund is here to help you decide which mortgage is best for you.

Conventional and Jumbo Loan Pros and Cons

A loan is one of the most important assets you will have in your life. But the decision to take out a loan should not be taken lightly. Amerifund's conventional and jumbo loan pros and cons will help you understand and simplify the decision process.

With our low-interest loans, the Amerifund Corporation & Realtycan help you finance your dream house! We make it simple to buy a house by providing you with all of your home-buying needs in one place, using easy processes and efficient service. Whether you need a Conventional or a Jumbo Loan, we've got you covered. Get started today!