With rising home prices in Seattle, some buyers may wonder if they’ll need a jumbo loan or can still qualify for a conventional mortgage. Here’s how to tell.
Seattle’s Conventional Limit
For most of King County where Seattle is located, the maximum for a conventional conforming loan in 2023 is $970,800.
This applies to mortgages backed by Fannie Mae and Freddie Mac. The limit is higher than most areas because Seattle is considered a high-cost market.
When a Jumbo is Necessary
If the purchase price of the home you want is above $970,800, you won’t be able to get a conventional loan. Instead, you’ll need a nonconforming jumbo mortgage.
Jumbo loans have higher minimum amounts, such as $750,000 or $1 million depending on the lender.
Since they aren’t government-backed, jumbos come with higher standards for credit scores, income and reserves, and lower debt-to-income ratios. Down payments are usually around 10-20%.
So in Seattle’s competitive housing market, buyers needing mortgages over $970k must carefully prepare to meet jumbo loan qualifications.
Check the latest conventional limits before buying higher-priced to determine if you’ll need a jumbo loan.