New Jumbo Loan Offering Could Help Clients Qualify

When you’re looking to buy or refinance your home, lenders have traditionally used items like pay stubs, W-2s and tax returns to verify your monthly qualifying income. However, not everyone earns their pay the same way.

If you’re self-employed, retired or receive a large bonus in addition to your salary, those things are sometimes documented differently and can present a slight challenge when it comes to getting a mortgage.

Quicken Loans is excited to bring you its new Agency Plus jumbo loan offering where clients may discover they can qualify even if they had trouble before. If you’re in the market to buy a home or refinance and have substantial assets, but don’t have an income where the amount is always consistent, it might be time to look again at getting a mortgage.

Let’s dig into the features now!

Qualify with Assets

If you’re looking to get a jumbo loan, clients with lots of assets can derive a monthly income from them for the purposes of qualifying for a mortgage.

To explain what we mean by that, let’s do a quick example assuming $700,000 worth of saved up assets. During the qualification process, it’s assumed you’ll be using those assets to make payments on your loan. Over the course of a 30-year loan, you would be able to use $1,944.44 toward your mortgage payment ($700,000 divided by 360 months).

In order to use your assets in order to qualify, you have to have at least $500,000 worth of assets available to you. To help you get to that number, let’s run through another great feature of this loan option.

Make Restricted Stock Work for You

Many companies offer restricted stock in the company to their team members as part of their compensation. The idea is that in addition to your salary, you get an ownership stake in the company. The only catch is that there are often restrictions on what you can do with the stock until you’ve worked with the company for a certain number of years.

Most commonly, you only get access to a certain amount of stock until it fully vests after a waiting period or you can’t sell it for a certain amount of time.

With this jumbo product, we’re able to count your restricted stock as part of your income for qualification purposes in the same way we might qualify you with a bonus. This could make it easier to qualify.

How Does This Loan Option Work?

You may be naturally wondering how everything works with this particular loan offering. Let’s briefly talk about it.

This is only offered as a 30-year fixed loan option. The advantage of this is a lower monthly payment for the client because of the longer term.

With this loan, you’re also qualified using Fannie Mae standard guidelines. Many of the standard conforming Fannie Mae qualifications are slightly easier to meet than typical jumbo loan qualifications which tend to be a bit more strict because of the higher loan amounts. Fannie Mae guidelines are also more well-defined than jumbo guidelines which can vary from lender to lender.

Who Does This Make the Most Sense For?

There are several types of people for whom a jumbo loan structured this way makes a ton of sense.

If you’re self-employed and have plenty of savings, but it doesn’t necessarily show up on your taxes due to deductions, the ability to qualify with assets can make this the perfect option for you. It also makes sense if you have plenty of assets and no income in retirement. Even if you’re not retired, clients with a lower monthly income but a large amount of assets may now be able to qualify based on their assets alone.

It also works for people who have an income, but it’s not always the same amount. If you get paid on commission or get a big bonus outside your salary, this could be great for you.

Finally, loans don’t often allow you to use your restricted stock units as income. That’s a huge advantage of this loan option.

If this Agency Plus option for a jumbo loan sounds right for you, you can get started online or give one of our Home Loan Experts a call at (800) 785-4788. If you have questions, you can leave them for us in the comments below.

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