What is a Jumbo Loan in Wyoming 2023?

Depending on the loan amount you need and where you’re buying a home in Wyoming, you may find it difficult to find financing beyond the conforming loan limits. This is where jumbo loans come into play.

What is a jumbo loan?

A jumbo loan in Wyoming is a type of mortgage that is used to finance homes that exceed the conforming loan limits set by the Federal Housing Finance Agency (FHFA). Oftentimes, this type of loan is necessary for high-end, luxury homes or homes located in expensive housing markets, like Los Angeles or New York. 

If the loan amount needed is more than the conforming loan limit (CLL), you’ll need a jumbo loan. Wyoming jumbo loans allow you to borrow more money to buy a more expensive home, but they also come with higher interest rates and stricter requirements than conventional loans.

What is the jumbo loan limit in Wyoming?

In 2023, the conforming loan limit for most U.S. real estate markets is $726,200. However, the loan limit in Wyoming depends on the area you’re planning to buy a home in. 

• $726,200 is the conforming loan limit in most Wyoming counties
• $1,089,300 is the maximum limit in Wyoming’s more expensive counties

As a reminder, the loan amount is what determines whether or not you’ll need a jumbo loan, not the price of the home. So, if you were to put $50,000 down on a $750,000 home in Lincoln County, the loan would be $700,000, which is under the CLL for this area. In this case, your loan wouldn’t be considered a jumbo loan.

The following counties in Wyoming have a conforming loan limit beyond $726,200 for 2023:

This FHFA map will give you more specific information related to the conforming loan limits in your county. 

What are the requirements for a jumbo loan in Wyoming?

To qualify for a jumbo loan in Wyoming, borrowers must meet stricter requirements than they would for a conforming loan. The specific requirements can vary from lender to lender, but below are the typical requirements for borrowers seeking a jumbo loan.

Higher credit score: In order to be eligible for a jumbo loan, most lenders will require a credit score of 720 or higher. While some lenders may be more lenient and accept a score as low as 660, a score below this is generally not accepted. In contrast, a credit score as low as 620 could suffice for a conforming loan with some lenders.

Larger down payment: Obtaining a jumbo mortgage typically requires a larger down payment compared to a conforming loan. Lenders may require a down payment of 10% to 20% or more, depending on the specific loan program and the borrower’s financial situation. If you’re approved with a down payment less than 20%, keep in mind you’ll most likely be required to purchase private mortgage insurance (PMI).

More assets: Jumbo loan borrowers are typically required to have more assets than those seeking conventional loans. Lenders will review a borrower’s assets to ensure they have enough liquid assets or savings to cover at least one year of loan payments. This requirement is in place to mitigate the increased risk associated with larger loan amounts.

Lower debt-to-income ratio (DTI): When applying for a jumbo loan, Wyoming lenders typically look for a borrower with a debt-to-income ratio (DTI) below 43%. Ideally, a DTI closer to 36% or lower is preferred. The DTI is calculated by dividing the sum of all monthly debt payments by gross monthly income. A lower DTI signifies a borrower’s ability to manage their current debt load while taking on additional mortgage payments. It also indicates greater financial stability and the ability to make on-time payments towards their non-conforming loan.

Additional home appraisals: For a jumbo loan, lenders may require an additional home appraisal as a second opinion, especially if the property is located in an area with few comparable sales. This is to ensure that the home is worth the loan amount or more and to mitigate the lender’s risk. The cost of the appraisal may also be higher in regions with limited  property sales.

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