Loan types
Jumbo loan
A mortgage larger than the conforming loan limit, so it can't be sold to Fannie Mae or Freddie Mac — requiring stronger credit, a larger down payment, and cash reserves.
What does jumbo loan mean?
A jumbo loan finances an amount above the conforming limit, which lenders hold on their own books or sell privately. That means stricter underwriting: expect a 700+ score, 10–20% down, full documentation, and reserves.
Because banks carry the risk themselves, jumbo pricing is relationship-driven — institutions with strong deposits often price aggressively for existing clients.
Why it matters
With Michigan's median home around $285,000 — well under the conforming limit — most buyers never touch jumbo territory. It only comes into play at the top of the Ann Arbor, Oakland County, and lakefront markets.
If your loan lands just above the conforming floor, ask whether it qualifies as a high-balance loan, which prices cheaper than true jumbo.
Common questions
When do I need a jumbo loan in Michigan?
When you borrow more than the conforming limit — which in Michigan mostly happens in Ann Arbor, Oakland County, and lakefront markets. Elsewhere the median purchase stays conforming.
What credit and down payment do jumbos require?
Usually a 700+ score, 10–20% down, full documentation, and cash reserves, since lenders hold the risk themselves rather than selling to Fannie or Freddie.
What is a high-balance loan?
Pricing in the band just above the conforming floor — cheaper than true jumbo. Near the limit, ask a Michigan lender whether your loan qualifies as high-balance.
Related terms