Jumbo Mortgage Refinance: How to Qualify

A jumbo mortgage refinance is very similar to taking out a jumbo purchase loan. You can use the refinance to change your interest rate, swap out your loan term or take cash out of your home equity. All of these options can be financially beneficial over the long term.

However, compared to refinancing a “normal” (conforming) mortgage, you’ll have to meet a higher bar when qualifying for a jumbo mortgage refinance. We’ll cover what you need to know before taking advantage of the perks of a jumbo refinance.

1. Determine your loan type

You can take advantage of the jumbo mortgage refinance process to replace your mortgage, but first, you should check to see if your refinance actually needs to be jumbo. If you’ve paid down your mortgage quite a bit, you may not need a jumbo refinance loan, which can make the process easier and cheaper.

How high your loan amount can be before it becomes “jumbo” changes each year, when the Federal Housing Finance Agency (FHFA) sets conforming loan limits. In 2025, the conforming loan limit for a single-family home in most of the U.S. is $806,500, and rises to $1,209,750 in some high-cost areas.

  Find the exact limits in your area with our loan limits map.

2. Know the purpose of your refinance

Whether your refinance needs to be jumbo or not, you should first consider what you want to use the refinance to achieve. You may want to:

• Get a better interest rate. If your credit score has improved, you’ve paid down some debt or boosted your savings and income, you may qualify for a better APR. You can see current jumbo mortgage rates here.
• Lengthen your loan term. If your monthly budget needs some wiggle room, you could refinance your jumbo mortgage. If, for instance, you have 20 years left on your mortgage, refinancing to a 30-year mortgage will likely lower your payments.
• Shorten your loan term. If you can afford a higher monthly payment, you could save thousands in interest by switching to a shorter-term, such as a 15-year fixed-rate, jumbo loan.
• Take cash out. Convert home equity to cash by borrowing more than you owe with a jumbo cash-out refinance. The extra funds can be used to pay off debt or make large purchases that would cost more to finance via other means. Here’s a cash-out refinance calculator.
• Switch to a flexible interest rate. Jumbo adjustable-rate mortgages (ARMs) typically feature a lower rate for a set time, such as three, five or seven years, and then adjust based on the terms. They can be a good choice if you plan to sell your home before the initial fixed-rate period expires.
• Make interest-only payments. Some loans allow you to pay only the interest charges each month for a set time, which makes your monthly payment significantly lower. This may be a good choice for temporary savings, as long as you have the resources to make the full payment once the interest-only period ends.

3. Check your finances

Jumbo refinance guidelines set a higher bar than conforming loan refinance requirements. Although they vary by lender, jumbo refinance requirements typically include:

• A minimum credit score of 680 to 700
• A debt-to-income (DTI) ratio that doesn’t exceed 45%
• Mortgage cash reserves equal to at least six monthly mortgage payments
• A minimum amount of equity in your home, which may be in the ballpark of 20% to 35%.
• No major credit problems in your recent past, such as bankruptcies or foreclosures

If you don’t meet these requirements, not all is lost. There are non-qualified mortgage (non-QM) loans, which have more flexible requirements but typically cost more. You could also take time to improve your credit score and financial strength before applying for a jumbo mortgage refinance.

4. Rate shop and lock

Shop and compare rates with at least three to five lenders to ensure you’re getting the best deal.

You may need to shop with several lenders, as not all lenders offer the same jumbo mortgage programs and rates. Be sure to ask the loan officer you speak with about their rate lock option for jumbo loans — some lenders require a loan approval before locking in a jumbo loan interest rate.

5. Fill out the paperwork

Jumbo loans typically require more paperwork and take longer to close than standard loans because a human loan underwriter, rather than an automated algorithm, is responsible for ensuring the loan meets investor standards.

To advance the process, respond to any lender requests quickly. It can be good to have some things on hand and ready, such as full documentation of all income sources, including tax returns, pay stubs, CPA letters and IRS validation of all filed tax forms.

 Have funds ready to go as well. Refinance closing costs can be anywhere between 2% to 6% of the loan amount.

6. Review your jumbo refinance closing disclosure

All mortgage refinance lenders must provide you with a closing disclosure three business days before your closing. Review the document and, if everything is correct, go ahead and sign. Your old jumbo loan will be paid off and your new jumbo loan will take effect.

What are today's jumbo refinance rates?

Based on current mortgage rate trends, we can expect 30-year fixed jumbo refinance rates to remain about 0.30 percentage points higher than comparable conforming loans. However, the Federal Reserve has signaled it intends to make at least two cuts in 2025 and, if it does, rates could embark on a downward trajectory.