If you’re a Boston area veteran looking for a Jumbo Loan, VA Jumbo Loans is a fantastic program. Be careful of banks trying to get you into another Jumbo Loan of 5-year or 7-year ARM. VA offers the lowest fixed rate Jumbo Loans.
How it works: For example, if the VA loan limit in Massachusetts is a half a million dollars; for every dollar above the half a million you just have to put down 25%.
Why? When a bank gives you a VA loan, the VA insures all loans for 25%. So if you’re on a Jumbo Loan up to a million dollars for that loan all you have to do is put down 25% above the limit.
Example: if the limit in Massachusetts is half a million dollars, you put down 25%. 25% of a half a million is a $125,000. So you can borrow in a million dollar purchase $875,000 at 3½% today, which is way less than any other program.