The jumbo property market in Texas is in much better shape than most markets around the country. However, sales are still slow in the upper end due to a variety of factors.. One of the least discussed of these factors is the large down payment and reserve requirements for a jumbo mortgage. While the actual number varies on a case-by-case basis, most jumbo mortgages require a down payment that is at least 20%-25% of the purchase price. Knowing those percentages, it’s easy to see how a down payment for something that is $800,000+ requires a massive amount of cash.But, the limiting factor for a lot of would be buyers is actually the reserve requirement needed on top of the down payment.
Reserves are defined as liquid cash left over after a down payment and closing costs. Most lenders require 12-24 months of principal, interest, taxes and insurance. If we assume a 800k purchase with 20% produces a principal, interest, taxes and insurance payment of $5600. This means an $800k purchase requires at least $160k for the down payment and $67,200 in cash to meet the reserve requirement for a total of over $227k needed in cash. Obtaining cash in that kind of volume is an insurmountable hurdle for many American families.
Fortunately, Hurst Lending has been able to come up with an offering that substantially lowers the actual amount of cash needed to obtain a jumbo mortgage. For qualified borrowers in the Dallas Fort Worth metroplex, Hurst Lending only requires 10% down for mortgage amounts up to $875K. Even better, only six months of reserves are required. This effectively cuts the cash you need in hand in half, from over $227k to $116k. By anyone’s calculation, $116k is much easier to come up with than $227k.
Jumbo property purchases can be incredible investments, but few homeowners in Texas are able to take advantage because of the massive amounts of cash a jumbo mortgage normally requires. Thanks to Hurst Lending, the amount of cash needed has been cut in half, making these type of mortgages much more accessible. If you are in the market to buy a jumbo property or if you are marketing a jumbo property for sale, and you live in the Dallas Fort Worth metroplex, please contact firstname.lastname@example.org or call Jay Hurst at 214 629 7909 to learn how we can help.