If you’re an eligible veteran of the U.S. Armed Forces or the surviving spouse of a veteran, you’re entitled to a variety of nice benefits earned through service. One significant benefit, which can make a big difference in your day-to-day expenses, is a Department of Veterans Affairs (VA) loan. These loans typically offer lower down payments and credit score requirements compared to other types of mortgages.
Most VA loans allow you to borrow up to the federal conforming loan limits for your area. But what if you need to borrow more money than that?
That’s where VA jumbo loans come in. They offer many of the same benefits of a conforming VA loan, but with more buying power. Let’s go over VA jumbo loan requirements, their benefits and the risks involved so that you fully understand how these loans work.
Key Takeaways:
- A VA jumbo loan lets you borrow more than the conforming loan limits for your area.
- Lenders tend to impose stricter requirements for jumbo loans.
- Borrowing a larger sum for a home means taking on additional risk, so you’ll need to make sure you can afford your monthly mortgage payments.
What Is A VA Jumbo Loan?
A VA jumbo loan is defined as a VA loan that exceeds the conforming loan limits for your area. These limits are set annually by the Federal Housing Finance Agency (FHFA).
In 2025, the conforming loan limit for one-unit properties is $806,500. However, in high-cost areas such as Alaska, Hawaii, Guam and the U.S. Virgin Islands, the limit is $1,209,750.
If you need to borrow more than that, lenders can extend a nonconforming or jumbo loan that is still backed by the VA. A VA jumbo loan offers many of the benefits of a VA loan, just with a higher loan amount.
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What Are The VA Jumbo Loan Limits For My Area?
Technically, a jumbo loan doesn’t have an upper limit like a conforming loan does. Each lender can decide how much money it is willing to lend when writing a jumbo loan.
Whether you need a VA jumbo loan will depend on the conforming loan limits for your part of the nation. If you live in a county that’s considered a high-cost area, there may be higher loan limits you can take advantage of before you need to go with a jumbo loan.
Because VA loans follow the same conventional loan limits as other loans, looking at the Federal Housing Finance Agency’s guidelines can help you determine whether or not you will need a jumbo loan.
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What Are The Benefits Of VA Jumbo Loans?
With a VA jumbo loan, borrowers can access higher mortgage amounts than with conventional loans. These flexible guidelines often allow more homeowners to buy or refinance in difficult housing and financial markets. Here are some more benefits of VA jumbo loans.
No Down Payment Requirement
If you’re purchasing a home, your VA jumbo loan lender may waive the down payment requirement, depending on how much you borrow. This practice differs from typical jumbo loans, which typically require a down payment of at least 10% and sometimes 20% or more.
No Mortgage Insurance Required
There’s no mortgage insurance required with a VA loan, including a VA jumbo loan. Other types of home loans may require private mortgage insurance, for down payments of less than 20%, or Federal Housing Administration mortgage insurance premiums, which can last for the life of the loan.
No Prepayment Penalties
Unlike some conventional loans, there are no prepayment penalties on VA home loans if you decide to pay off the mortgage early.
VA Financial Assistance
If you find yourself experiencing a financial hardship – like an illness or the loss of a job – you may be eligible for help with your mortgage. VA assistance is generally available for veteran borrowers in default on their mortgage due to temporary financial difficulty – and this could help you avoid foreclosure.
Funding Fee Flexibility
Like most VA loans, VA jumbo loans require an upfront funding fee. These fees range from 1.25% to 2.15% of the loan amount for a first-time home purchase, and 1.25% to 3.3% for a subsequent home purchase.
The good news is that you have the ability to roll the VA funding fee into your loan if you can’t pay it up front. Also, the funding fee is waived for disabled veterans or surviving spouses, or if you’re a Purple Heart recipient serving in an active-duty capacity.
VA Loan Entitlements
Another factor that may affect how much you can borrow is your VA loan entitlement, which is the amount of money that the Department of Veterans Affairs guarantees if you were to default on your loan. As long as you have your full entitlement available (as opposed to a reduced or partial entitlement, usually due to a previous loan), the government will guarantee up to 25% of the total amount that you borrow. This could give you more borrowing options.
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What Are The Drawbacks Of VA Jumbo Loans?
Although VA jumbo loans offer many benefits, there are some drawbacks and risks associated with them.
Larger VA Funding Fee
VA funding fees, as mentioned earlier, range from 1.25% to 3.3% of the amount being borrowed. A jumbo loan, by nature, is a large loan amount. This means that with a VA jumbo loan, you may be looking at an even larger funding fee.
Stricter Lender-Specific Requirements
The VA does not set credit score requirements. Lenders have the discretion to set those themselves. However, some lenders may have higher credit score requirements for a VA jumbo loan because they’re loaning out a larger amount of money.
Higher Interest Rates
VA jumbo loan rates are usually pretty competitive compared to non-VA jumbo loan rates. Because of the added risk that comes with a larger loan, however, you may end up with a higher interest rate on a VA jumbo loan than with a standard VA loan.
Possible Down Payment Requirement
Veterans with full VA loan entitlement generally do not need to make a down payment on a VA jumbo loan. But if you don’t have full entitlement, you may be required to make a down payment.
Potential to Be Underwater on Your Mortgage
A significant benefit of VA loans, including VA jumbo loans, is not having to make a down payment. This comes with its own risk, though: If you don’t put money down and home values fall, you risk ending up underwater on your mortgage (which means you will owe your lender more than what your home is worth). That risk is elevated with a jumbo loan since you’re borrowing even more money.
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What Kind Of Mortgage Rates Can You Get With A VA Jumbo Loan?
Because you’re borrowing more money, the interest rate for a VA jumbo loan may be higher than the rate you could get for a traditional VA loan. However, you may get a more competitive interest rate on a VA jumbo loan than on a non-VA jumbo loan.
Your lender will take your full financial picture into account when deciding what VA jumbo loan rate to offer. That will include your credit score, debt-to-income ratio and down payment, if you’re choosing to make one.
What Are VA Jumbo Loan Requirements?
In addition to being an eligible veteran or the surviving spouse of a veteran, there are other requirements to qualify for a VA jumbo loan.
Credit Score Requirements
VA jumbo loans require a higher credit score than typical VA loans due to their higher loan amounts. While the VA does not have a minimum credit score requirement, lenders typically set their own.
For instance, a lender may accept a minimum median credit score of 580 to qualify for a conventional VA loan. Jumbo loan requirements for the same lender, meanwhile, may be stricter, with a minimum median FICO® Score of 680. These credit score requirements may also increase depending on the amount that you plan to borrow.
Down Payment Requirements
VA loans generally do not require a down payment. If you don’t have full entitlement, however, you may have to make some type of down payment on a VA jumbo loan.
VA Inspection Requirements
Most lenders require a home appraisal to qualify for a mortgage. While a home inspection is also advisable, it isn’t always a requirement to finalize a home loan.
To qualify for a VA loan, however, the home that you plan to buy must meet VA loan inspection requirements. This usually involves a thorough home inspection by a VA-certified inspector and may also include a VA loan-specific pest inspection.
The Bottom Line: A VA Jumbo Loan May Be The Right Option For You
A VA jumbo loan may be the right option for you if you’re looking to take advantage of VA benefits – such as no down payment or mortgage insurance requirements – when buying a home with a higher purchase price. Before you take out a VA jumbo loan, though, be sure you understand the pros as well as the cons.
Also, don’t hesitate to shop around with different VA lenders in your area. Any time you’re borrowing a large sum of money, it pays to do some research so that you can snag the most competitive interest rate possible.
Maurie Backman
Maurie Backman has more than a decade of experience covering personal finance topics that include mortgages, loans, retirement, Social Security, and investing. Prior to becoming a full-time writer, she worked in the financial industry as well as in product design and marketing. Maurie holds a bachelor's degree from Binghamton University, where she studied creative writing and finance. She was happy to combine her two areas of study into a career that allows her to educate consumers on a host of financial topics.
