What Counts As A Jumbo Loan In Hennepin County?

Shopping in Edina and wondering if your mortgage will count as a jumbo? You are not alone. Higher price points in Hennepin County mean many buyers brush up against conforming loan limits without realizing it. In this guide, you will learn what defines a jumbo loan, how to check the current county limit, and what that means for rates, down payments, and documentation. Let’s dive in.

Jumbo vs. conforming: the basics

A conforming mortgage meets the criteria for purchase by Fannie Mae or Freddie Mac, including a county-level maximum loan size. If your loan amount is at or below the Hennepin County conforming limit for the property type and unit count, it is considered conforming.

A jumbo loan is any mortgage that exceeds the county’s conforming limit. These loans are kept in a lender’s portfolio or sold to private investors, not to Fannie or Freddie. Because of that, jumbos often come with different pricing and stricter underwriting.

How loan limits are set each year

The Federal Housing Finance Agency updates conforming loan limits annually, using changes in the house price index from the prior year. Limits vary by county and by property unit count. Multi-unit properties have higher limits than one-unit homes. The new limits are typically announced in the fall for the following calendar year.

Where to find Hennepin County’s current limit

Always verify the current year’s number before you write an offer. The official source is the FHFA. Use the FHFA conforming loan limit lookup to confirm Hennepin County’s limit and the correct unit count for your property type. You can also cross-check on the Fannie Mae loan limits page and the Freddie Mac loan limits page.

• Check the FHFA conforming loan limit lookup for Hennepin County.
• Cross-check on Fannie Mae and Freddie Mac sites for the same year.

How to tell if your Edina purchase is jumbo

Use this simple test:

1. Estimate your loan amount. Start with the purchase price, subtract your down payment, then add any financed closing costs if your lender includes them in the loan amount.
2. Find the current Hennepin County conforming limit for the property’s unit count.
3. If your loan amount is greater than the county limit, you will need a jumbo product.

For condos, townhomes, and multi-unit properties, confirm the correct limit for the specific unit count. This can change your status from conforming to jumbo.

What jumbo status means for your financing

Rates and pricing

Jumbo rates have historically been modestly higher than conforming rates because jumbo loans are less liquid. That said, rate spreads shift with market conditions. Well-qualified borrowers sometimes see jumbo rates that are competitive. It pays to compare quotes from several lenders.

Down payment and PMI

Conforming loans allow higher loan-to-value options, though private mortgage insurance applies above 80 percent LTV. Many jumbo lenders expect larger down payments, often around 20 percent or more for primary residences. Jumbos typically do not offer standard PMI, so lenders use pricing, larger down payments, or piggyback structures instead.

Credit score and documentation

Jumbo underwriting is stricter. Higher credit scores are usually required for best pricing. Expect full documentation of income, tax returns when applicable, explanations for large deposits, and detailed asset statements with proper seasoning.

DTI and cash reserves

Debt-to-income limits are often tighter on jumbos, or you will need strong compensating factors. Plan for significant cash reserves after closing, commonly several months of principal, interest, taxes, and insurance. Higher loan amounts, second homes, and investment properties may require even more.

Property type and occupancy

Second homes and investment properties face stricter jumbo underwriting. Requirements can include higher down payments, more reserves, and higher rates. Be sure to confirm specifics early if you are buying a vacation home or an investment.

Refinancing considerations

Jumbo refinance options are more lender-specific than conforming refis. Cash-out limits, seasoning rules, and documentation can be stricter. If refinancing might be in your future, discuss that with lenders while you shop.

Common Edina buyer scenarios

Higher-end home with 20 percent down

You find a home in Edina, plan to put 20 percent down, and your 80 percent loan still exceeds the Hennepin County conforming limit. That means jumbo underwriting and likely higher reserve requirements. Prepare documentation and assets early.

Smaller down payment on a higher-priced home

You prefer a lower down payment to keep more cash on hand. If the purchase price already sits above the conforming limit, the loan amount may push deeper into jumbo territory. Some lenders have options, but terms can be more restrictive.

Dual-loan (piggyback) structure

Some buyers use a first mortgage at or below the conforming limit, plus a second mortgage for the remainder. This can help avoid jumbo status or conventional PMI, but it adds complexity. Compare the combined rates and closing costs to a single jumbo loan.

How to prepare in today’s market

Use this checklist to stay ahead:

• Get fully pre-approved with a lender that actively offers jumbo products.
• Shop more than one lender or include a mortgage broker to compare pricing and reserve requirements.
• Gather asset statements and tax documentation early. Organize explanations for any large deposits.
• Confirm whether your plan includes a condo or multi-unit property and check the correct unit-count limit.
• If you expect jumbo financing, consider strengthening your offer with a larger down payment or proof of reserves.

Reliable resources for limits and basics

• Use the FHFA conforming loan limit lookup to verify the current Hennepin County limit.
• Review the Fannie Mae loan limits page and the Freddie Mac loan limits page to cross-check the annual limits.
• For plain-language mortgage guidance, the CFPB mortgage basics page is a helpful reference.

Thinking about a move in Edina or the west metro and want a smart financing plan from the start? Let’s talk through price points, loan structures, and offer strategy so you can buy with confidence. Connect with Mark Bartikoski and The Bartikoski Group to Search All Homes and Get Exclusive Off-Market Listings. Reach out to Mark Bartikoski for a no-pressure consultation.

FAQs

What defines a jumbo loan in Hennepin County?

• A jumbo loan is any mortgage amount that exceeds the current Hennepin County conforming loan limit for the property’s unit count, as published each year by FHFA.

How do I find the current Hennepin County loan limit?

• Use the FHFA conforming loan limit lookup for the current year and confirm you are viewing Hennepin County and the correct unit count for your property type.

Does the home price or loan amount make it a jumbo?

• The loan amount determines jumbo status. A larger down payment can keep a high-priced home within conforming limits if the resulting loan amount is at or below the county limit.

Are jumbo mortgage rates always higher?

• Not always. Jumbo rates are often higher, but spreads change with market conditions. Well-qualified borrowers sometimes see competitive jumbo pricing, so it is smart to compare quotes.

Do jumbo loans require private mortgage insurance?

• Standard PMI is tied to conforming loans. Many jumbos require larger down payments instead, or use lender-specific solutions or piggyback structures.

How many months of reserves do jumbo lenders want?

• It varies by lender and scenario. Many require multiple months of principal, interest, taxes, and insurance, with higher amounts for larger loans, second homes, or investment properties.