Today, we're going to be talking about what is a jumbo loan and at what point does a loan become a jumbo. Okay, so first of all, I am not talking about government loans in this video, so for all my veterans, guys, different ball game. This video does not apply to you guys and gals. And then FHA, totally different loan limits, different video. Okay, this is for if you're doing a conventional loan, you know, five percent, ten percent, fifteen percent, twenty percent, what you need to know, three percent.
So, wouldn't it be easy if all around the United States I could say, hey, if the loan amount's over $800,000, we're going to be looking at a jumbo loan, wouldn't that be easy? Yeah, that's not the way it works though. Okay, so here's the deal, every single year loan limits change, that's the first thing. So, for instance, for 2023, the loan limit for the United States is $726,200. And you go, oh, Jen, cool, so anything over $726,200 is jumbo, right? No, no, not necessarily. So, it depends on the county you live in.
So, what happens is, you know, Fannie and Freddie come up with this number based on the average cost of housing around the United States, which we have seen jump dramatically. You know, I remember when I got into the business, it was like $400,000, $500,000 was the loan limit, and it's just gone up and up. However, there's parts of the country that are incredibly expensive. So, although $726,200 is the overall, they have what's known as high balance, so it's like an additional layer, and an example of that would be San Francisco. You know, San Francisco's loan limit's over a million dollars for a conventional loan.
Okay, so California is where we see a lot, lot of this, you know, there's certain states where it's going to be jumbo no matter what if you're over $726,200. California is definitely a messier state in terms of that because you can literally throw a rock, be in another county, and your entire loan qualification changes, no joke. Okay, so what you're going to want to do, regardless of what state you live in, is you're going to want to go online and look at what the 2023 loan limit is for the counties you are looking in.
Okay, now look, if you guys are looking and your loan amount is going to be under $726,200, you don't have to do this. Okay, this is only if your loan amount is going to be over $726,200 that you're going to want to go online and take a peek. Okay, because like New York, New York has a bunch of different loan limits above $726,200, it's a higher cost area, so they have that high balance loan. So when jumbo kicks in in certain counties in New York, it's going to be different. Okay, so you're going to want to go online, look at what the counties you're looking in, what the loan limits are.
Okay, now look, if they're all the same, easy peasy, right? That's easy for a lender to do. But if they're not, you're going to want to talk to your lender about this up front. You're going to want to say, hey look, I'm looking in these three counties, it looks like the loan limits are different, how does this impact me? Okay, and you may be like, well, shouldn't they just tell me that? Guys, we don't always know all the counties you're looking in. We don't have a clue what counties you're looking at half the time. We may think you're looking in one county, you may feel like you told us you were looking in four, and here's where it gets dangerous.
So where I started my business is in Sonoma County, California. Sonoma County touches Napa County, it touches Mendocino County as well, and it touches Marin County. All four of those have different loan limits, I'm not kidding. So for instance, if I qualify you for a conventional loan with five percent down in Sonoma County, and then you decide to go up to Mendocino to buy, guess what? You may not qualify because the loan amount that in Sonoma was conventional, it may be jumbo in Mendocino. Jumbo loans have different guidelines, different requirements. So what may work 10 minutes away doesn't work over here because of the loan limit.
And then, you know, Napa was higher than Sonoma, and Marin was higher than them all. So it's like, if you had someone looking in Marin and they ended up in Sonoma, you were constantly changing what people could qualify for. And as a buyer, you guys are like, oh my God, I can't even... this is so stupid, like, how is this a thing? It's a thing, it's a thing, and that's why when you say what is a jumbo loan, the answer really is, it depends, it depends on where you're looking. So questions, comments, I am licensed in 48 states to do mortgages. I am happy to talk all this out with you guys. We do have some pretty cool jumbo products that are like 10 down, but at the same point, you know, sometimes it makes sense to put down a cup a little bit more to stay conventional, and that's what we talk about a lot. Where is jumbo a benefit, where is it a burden? But overall, you need to know if you're in the jumbo world to begin with. So thank you for watching, guys, questions, comments, please reach out, get on the calendar with any questions, we are here to help you, but what's a jumbo ends on where you're looking. Thanks for watching.
What Is A Jumbo Loan? Jumbo Loans Explained 2023 (Official Guide to Jumbo Loans)
https://www.youtube.com/watch?v=gSzz-yjDkas