Super Conforming Loans
A type of loan which may also be referred to as a high-cost or high-balance mortgage loan are loans with higher loan limits of which exceed the maximum loan limits (set by FHFA) that are permitted in designated high-cost areas. In high-cost areas, loan limits are set specifically for the counties. However, Super Conforming loans meet loan limits set by FHFA at the county level.
Super-Conforming loan is another name for a Conforming High-Balance loan
Loan Amounts between $766,550 and $1,149,825 are referred to as agency High Balance or Super Conforming loans because they exceed the baseline limit as of 2024.
Main Requirements
- Minimum credit score – 620 on average for fixed mortgages and 640 on average for a (ARM) adjustable-rate mortgage. **Note: Higher the better**
- Minimum down payment – Required – 5% to 25% – depends on the qualifying borrower and the lender’s criteria based on your creditworthiness and the amount you plan to borrow.
- Income – High-Income earner to support the cost and repay current debt as well as potential home.
- Required DTI – 36% – 45%
- Special Criteria to Qualify for a High-Balance Loan – Must be applying for a loan in a high-cost area.
- Cash Reserves – Required on a case-by-case basis.
Super Conforming Loan
Key Points
- The borrowing limit can be as high as $150% of the national conformation loan limit set by the FHFA.
- Target High-density urban areas are high-prices areas where real estate prices are simply higher than the national average.
- Qualifying for a Super Conforming loan is essentially the same process as qualifying for a regular conforming mortgage.
- Super Conforming loans still meet the standards set by Fannie Mae and Freddie Mac, therefore, the criteria for borrowing and the interest rates available are roughly same as a conforming loan.
- Having a Super conforming loan means that the potential Buyer can borrow more money without having to make a higher down payment and pay more in interest like you would with a Non-Conforming or Jumbo loan.
- Can be used on 1-to-4-unit primary, secondary, and investment residences.
- Available for both fixed and adjustable-rate mortgages.