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Jumbo Loan Story - Long Post

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Jumbo Loan Story - Long Post

There are few data points for jumbo mortgages and even fewer for those with no down payment so I will share mine to pay it forward.

Initially I began the process with Navy Federal with a 665 middle mortgage score and the prospect of a 5.65% interest rate. I was told by Navy that the next tier was at a 720 mid score and the interest rate would drop to 5%. Of course, Navy also has that outrageous funding fee of 1.75% which can be wrapped into your mortgage. My LO was horribly unresponsive but very nice. The loan processor was amazing. Completely on top of everything and it was a relief when she got involved.

I spent a good amount of money getting utilization down and while my FICO 8 scores soared to a range of 768-772 my middle mortgage score never got higher than 717. Navy never ran my credit again because they said it would be unnecessary if I wasn’t at 720 and they wouldn’t rerun it at all unless I didn’t find a house and close before the credit report expired.

We went under contract on 6/28 and set closing for 7/25. $615k purchase price with seller credit towards closing of $15k. $6k earnest money.

I also began to look at other options. NASA had a comparable product with 0 down but I believe they amortized the revenue Navy derived from the funding fee into slightly higher rates. They also required either a 720 or 740 mid score.

I reached out to a local credit union (if anyone needs the info for a purchase in or around Atlanta PM me) that I had been planning to use when I was going to put 5% down and asked if they had anything for jumbos with 0 down. They did an 80/20 product with no PMI. The first loan was 3.375% 5/5 variable and the 2nd loan was 5.6% fixed over a 15 year period. No prepayment penalties for either loan and no funding fees. Loan origination fee was $3k plus a $400 underwriting fee.

I applied and received an approval which I honestly didn’t trust because it seemed to good to be true. The blended rate was going to be about 3.8% I believe when I did the math and I could simply refinance if I start to get nervous about interest rates.

I ultimately told Navy I was moving forward with another lender. They offered to try and match the rate which was commendable given the last pull they had I was sitting at a 665 mid score. My husband was not on the loan so just my scores. I knew the products were too different and they wouldn’t be able to so I proceeded with the other credit union. My Navy appraisal came in at $625k. They order it quick so I did end up paying for two appraisals.

Back to my other CU, they ordered an appraisal which came in at $630k, they still managed to make my closing timeframe which was impressive because I started the process with them about a week after I was under contract. I pushed the day to 7/26 because I had to travel for a meeting on 7/25 and couldn’t get out of it.

Questions I would anticipate:

DTI: I don’t know what Navy required but they approved me when I thought I might buy something a lot more expensive that would have placed me at 45% based on last 2 years income (about 38% using this year’s income but they didn’t factor that).

The other CU required less than 40%.

Scores: I mentioned them but my highest mortgage score was Experian at 723 mid was Transunion at 717 and Equifax at 703.

Reserves: I only thought about this as I was considering this post. It never came up with either of them. Now they did have my 401k statements which had at least 12 years of reserves, so maybe that’s why. I also gave them statements for personal investments that are illiquid for the next 9 months but totaled about $160k in vested value. I don’t know if they factored those assets at all since I can’t access them for 9 months. Wish I would’ve thought to ask for the reserves data point however.

Baddies: I have 6 baddies each one is a 30 day late with DCU 3 for 3 auto loans that have since been paid off and the other 3 for the credit card. The most recent was 14 months before closing! Not going to go into that too much but let’s just say their recurring payment process is something I have not mastered and the most recent was the result of me deciding to do it myself and still forgetting about it which is why I have everything else set-up on recurring payments. Not the point of the post so I hope this doesn’t lead to distractions but I wanted to paint a realistic picture of my situation in case it’s helpful to someone else. No other derogs on my file.

Revolving utilization: About $140k in revolving credit lines with 40% until when I was approved with Navy and about 8% utilization when approved with the credit union. 2 personal loans - one 30 days before my app and one 60 days beforehand.

Down payment: I initially planned to put 5% down but when I didn’t get the bump I was expecting score wise from an original pay down of credit, I instead used my intended down payment to further pay revolving stuff down and took out the consolidation loans. I could have of course pulled funds from my 401k but I’m at least 25 years away from retirement and I was not taking a hit for a 10% penalty plus taxes ordinary income and the loss of continued growth on those assets under any circumstances, when for far less I can simply refinance the loan.

Experience: as I mentioned the processor at Navy was great, the loan officer, no. The other CU was good to work with, especially the loan officer, but things felt a little like a black hole. Could’ve been my own paranoia because on several occasions I was convinced that something was wrong because I wasn’t hearing much, the status on their website never changed the whole time, Underwriting and Processing. On the day, I was supposed to receive the CD I was in full meltdown and they didn’t get it to me until 7:48 that evening. The loan officer was great however, in that case I think it was the processors delay.
Received the clear to close email yesterday!

Closed this morning so I wanted to get this out because I will forget otherwise and I have benefited so much from everyone’s experiences. This one is somewhat unique but hopefully it’s helpful to someone.

My advice would be to call around far and wide to inquire about jumbo products, especially with local lenders who know the local market. This product was never advertised on their website at all. There is so much variability in these products and you could be a phone call away from finding the solution that’s a perfect fit for your situation.
Message 1 of 9
Valued Contributor

Re: Jumbo Loan Story - Long Post

Second piece of advice: ALL ALL bills need to be on auto pay at least for the minimum required amount. If you want to go in and pay more later great but this will avoid forgetful mistakes, late fees and bad Fico Scores!

Message 2 of 9

Re: Jumbo Loan Story - Long Post



Thanks for all this info!  Long post, true, but very informative! 


Congratulations on finishing your journey and enjoy your new home Smiley Happy

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Message 3 of 9
Frequent Contributor

Re: Jumbo Loan Story - Long Post

Great story, congrats!

I’m in underwriting purgatory with NFCU right now, it’s crazy stressful! I’m in the same boat with reserves...I think they are using my stock account value which also isn’t accessible until 2/20. They never asked for 401k statements.
RBFCU Premier $25K, Sam’s Club MC $25K, Citi Exec WEMC $27.5K, Alliant Signature $20K, SSFCU $20K, Cap1 Venture $20K, Employer CU LOC $20K, Navy GoRewards $18K, 2nd NFCU Plat $14.7K, Citi Simplicity $14.7K, PenFed Power Cash $10K, PenFed PLOC $10k, Navy Platinum $12.7K, SMG $8.5K, PenFed Promise $2.5K, Total Rewards $6K, Discover It $1.7K, Discover It $2K, Cap One QS1 $850, Overstock $29.5K
DC BK13 3/17....TU clean due to EE as of 12/17! EX clean as of 4/18! EQ clean as of 5/4/18!
Message 4 of 9
Valued Contributor

Re: Jumbo Loan Story - Long Post

If you are concerned for goodness sake get your most current 401k stmt and get it to your Lender immediately. It’s a huge asset and IS considered as reserves.
Message 5 of 9
Regular Contributor

Re: Jumbo Loan Story - Long Post

I understand. In my experience underwriting was a blur. The only way I knew it had concluded was because I was advised the underwriter wanted an amendment to the agreement indicating that earnest money would be returned to the buyer at closing. The title company and my realtor thought that was odd but I eagerly complied. Literally nothing else came up throughout the process. I did see a soft pull 9 days before closing, maybe that’s when it went to underwriting. I started to panic on the day the CD was supposed to be delivered. It was a bad day that drug on so I can relate.
Message 6 of 9
Community Leader
Senior Contributor

Re: Jumbo Loan Story - Long Post

Thanks OP for sharing your experience. It’s an eyeopener.
GOALS: Garden til APR 2020 and 800 Club

GIRL WILLPOWER ("No Thanks" to Apple $7.5K, 12.99% Approval)

JUN 2019: EX 788, TU 794, EQ 779
DEC 2018: EX 777, TU 783, EQ 799

|| AmX Cash Magnet $25K || NFCU CashRewards $20K || Macy's $20K || Discover IT $18.7K || NFCU CLOC $15K || NFCU Platinum $12.5K || AmX ED $11.5K || CitiCostco $7K || CitiDC $6.3K ||
Message 7 of 9
Regular Contributor

Re: Jumbo Loan Story - Long Post

Thanks so much for sharing! This is a great post and congratulations on your awesome new loan product, that's an amazing rate!

Message 8 of 9
Valued Contributor

Re: Jumbo Loan Story - Long Post

Thank you for your post!  I found it very informative.  I greatly appreciate when people like you lay it all out because you actually answered some questions I had that I was unable to locate elsewhere. 

Congratulations on your new home!

Message 9 of 9
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