If you are looking to purchase a luxury property, or invest in a highly competitive real estate market, jumbo loans are an excellent option to provide you with the necessary financing for your dream home.
Over the past few years, jumbo loans have seen a significant increase in popularity – from 19% in 2020 to 32% in 2022, the highest level since 2005 according to CoreLogic data.
However, property prices have skyrocketed as well, costing 26% more than they did in 2020 according to the Federal Reserve data. In more competitive markets, home values have shot up above the $1 million mark, causing continuous updates to conforming loan limits each year.
Considering the dynamic changes in the industry, there is one important thing that you should take into account before applying for this type of financing – and that is, jumbo loan rates in 2024.
In this guide, we will discuss everything you need to know about jumbo loan rates, including some of the main factors that are impacting them.
What Are Jumbo Loans?
Jumbo loans, also known as jumbo mortgages, are a financing option that exceeds the limits set by the Federal Housing Finance Agency (FHFA). They are typically used to purchase properties in high-value areas.
For 2024, the conforming loan limit for most U.S. counties is $766,550, and in high-cost areas, it can go up to $1,149,825. Loans that exceed these amounts are classified as jumbo loans.
Since they are larger than the maximum loan amount allowed by the GSEs, they can’t be purchased, guaranteed, or securitized by Fannie Mae or Fredie Mac, which typically provide a form of implicit backing.
What Are Some Factors Impacting Jumbo Loan Rates?
Before we get into the numbers of jumbo loan rates, it’s important to keep in mind that there are multiple factors that influence them. These factors can be distinguished between personal ones, and economic ones. Let’s take a look:
Personal Factors Influencing Jumbo Loan Rates
When you are applying for a jumbo loan with a lender such as Jet Direct Mortgage, we will consider some of the following factors:
- Credit Score – Creditworthiness is an essential factor influencing jumbo loan rates, as it indicates that you are a reliable borrower. A minimum credit score of 700 is often required, although 740 can get you more favorable terms.
- Debt-to-Income (DTI) Ratio – DTI is another important factor that demonstrates that you have sufficient income to cover new debt, and you are less likely to default on the loan. Below 43% is generally required.
- Down Payment – When it comes to jumbo loan rates, the amount of down payment also matters. The larger the down payment is, the better loan terms and interest rates you can get since it reduces the Loan-to-Value (LTV ratio).
- Home Location – Another personal factor influencing the rates of jumbo loans is the location of the property. It affects whether the loan amount exceeds conforming limits, therefore needing a jumbo loan.
Economic Factors Influencing Jumbo Loan Rates
In addition to personal factors, there are some economic factors that also influence jumbo loan rates.
- Federal Reserve Monetary Policy – The Federal Reserve sets the rate of the federal funds, which in turn influences overall interest rates in the economy, including mortgage ones.
- Inflation & Economic Conditions – When there is high inflation, mortgage rates go up as lenders demand higher returns to compensate for the decreased purchasing power. Low inflation, conversely, leads to lower rates.
- Bond Market – Since mortgage rates are closely tied to the bond market, they are also impacted by it. When demand for MBS (Mortgage-backed securities) is high, mortgage rates tend to be lower.
- Secured Overnight Financing Rate (SOFR) – SOFR is a benchmark interest rate for overnight loans, reflecting the cost of borrowing cash overnight using Treasury securities as collateral. Changes in SOFR has a direct impact on jumbo loan rates.
- 10-Year U.S. Treasury Yield – Another essential indicator of long-term interest rates, the 10-year US treasury yield reflects investor expectations about future economic conditions. Mortgage rates tend to increase when the 10-year yield rises.
- Credit Market Conditions – When it comes to jumbo loan rates, another factor impacting the availability and cost of mortgage loans is the overall health of the credit market. For example, tight credit conditions lead to higher mortgage rates, while looser ones lead to lower rates.
- Housing Market Trends – Of course, we can’t forget about the housing market trends. Supply & demand has a huge impact on mortgage rates – high demand for housing pushes them up, while low demand brings them down.
What Are The Current Jumbo Loan Rates?
So, what exactly are the current jumbo loan rates in 2024? As we just discussed, they may vary based on multiple factors as well as the lender that you are applying with – however, the national averages look like this according to Zillow as of 25th of July, 2024:
- 30-Year Fixed Rate Jumbo – 6.76 % – APR – 6.81 %
- 15-Year Fixed Rate Jumbo – 6.67 % – APR – 6.63 %
- 7-year ARM Jumbo – 7.11 % – APR – 7.46 %
- 5-year ARM Jumbo – 7.05 % – APR – 7.62 %
Keep in mind that jumbo loan rates are changing constantly, so it’s always better to check with your financial institution before applying for a jumbo loan rate.
Is a Jumbo Loan Right For Me?
Now that you are more familiar with the jumbo loan rates and characteristics, you might be wondering – is a jumbo loan right for me? Let’s take a look at some of the key scenarios in which this type of financing is exactly what you need:
You Are Buying a Custom-Built or a Large Home
If you are thinking of purchasing a custom-built home or a property with large square footage, you probably know that they often come with higher price tags.
These homes often include luxury features and amenities such as extensive landscaping, custom architecture, and high-end materials, which drive the costs beyond the conforming loan limits – thus requiring a jumbo loan.
You Are Purchasing a Property in a High-Cost Area
Another scenario in which a jumbo loan may be exactly what you need is if you are purchasing a property in a high-cost living area – such as parts of California, New York, or Hawaii, where home prices often exceed the conforming loan limits.
These high-cost areas have a higher loan limit, but the property values frequently surpass even these elevated thresholds. A jumbo loan will provide you the necessary funds you need to purchase a home in these expensive markets.
You Are Buying a Second Home or Making an Investment
If you are purchasing a high-value investment property, a vacation home, or a rental property, you may need financing that exceeds the conforming loan limits.
These properties are typically located in desirable vacation spots or high-demand rental markets, which naturally drives up their price. For example, a high-end rental property in Manhattan, NY will likely need a jumbo loan.
About Jet Direct Mortgage
If you are ready to buy the luxury or investment property of your dreams, Jet Direct Mortgage can help you find the perfect loan fit for your needs and goals.
Our mission is to set a high standard in the mortgage industry through unmatched customer service, from the application process to the post-closing stage.
Our team of experienced professionals will guide you through the home loan process step by step, so you feel confident in your knowledge and make a well-informed decision on the best mortgage for you.
Are you ready to get started? Apply now for your jumbo loan!
FAQ
How do jumbo loan rates compare to conforming loan rates?
Jumbo loan rates typically are higher than conforming loan rates due to the increased risk lenders take on with larger loan amounts.
While conforming loans adhere to the limits set by the Federal Housing Finance Agency (FHFA) and can be purchased by Fannie Mae and Freddie Mac, jumbo loans exceed these limits and are not eligible for purchase by these government-sponsored entities, making them riskier for lenders.
Consequently, borrowers often face stricter qualification requirements and higher interest rates.
Are jumbo loan rates fixed or adjustable?
Jumbo loan rates can be either fixed or adjustable, similar to conforming loans. Fixed-rate jumbo loans have a consistent interest rate and monthly payments throughout the loan term, offering stability and predictability.
Adjustable-rate jumbo loans (ARMs) start with a lower interest rate that adjusts periodically based on market conditions, which can be beneficial if you plan to sell or refinance before the rate adjusts.
The choice between fixed and adjustable rates depends on your financial goals and market trends.
How can I get the best rate on a jumbo loan?
To get the best rate on a jumbo loan, maintain a high credit score, ideally above 740, and a low debt-to-income ratio. Make a larger down payment, and demonstrate significant cash reserves.
Shopping around and comparing offers from multiple lenders can also help secure the most favorable rate.
Do jumbo loan rates vary by lender?
Yes, jumbo loan rates vary by lender due to different risk assessments, pricing strategies, and market conditions each lender operates under. Factors like the lender’s cost of capital, competition, and borrower profile influence the rates offered.
How does the property location affect jumbo loan rates?
The property location significantly affects jumbo loan rates due to varying real estate market conditions, property values, and economic stability in different regions.
High-cost areas with stable or appreciating markets may offer slightly better rates due to lower perceived risk.
Conversely, properties in less stable or declining markets may have higher rates as lenders mitigate potential losses. Regional differences in lender competition and local economic factors also influence rates, making it crucial to compare offers specific to the property’s location.

Experienced Chief Operating Officer with a 26 + year demonstrated history of working in the banking industry. Skilled in all aspects of the residential mortgage market . Strong business development professional with a Bachelor of Science (BS) focused in Business Administration and Management, from St. Joseph College. A direct endorsement underwriter and a licensed Mortgage Loan Originator.