Colorado High Balance Conforming Loans

What is a High Balance Conforming Mortgage?

High Balance Conforming loans are $424,101 up to the High Balance Limit for that County

FOR LOANS LARGER THAN THE LOAN LIMITS CHECK OUT OUR "JUMBO LOAN" PROGRAMS

A High Balance Conforming loan is greater than the Fannie Mae's and Freddie Mac's national maximum loan limits. This is because the home prices in the state county where the property is located is more expensive than most areas in the United States where the 2017 Conforming Loan Limit is $424,100. Loans in these areas are still eligible for purchase by Fannie Mae or Freddie Mac, and have great interest rates just like the Conforming loans.

Some Colorado counties High Balance Conforming loans go all the way up to $636,150

Areas where real estate is more expensive like Aspen, Beaver Creek, Breckenridge, Copper Mountain, Keystone Resort, Steamboat Springs an Vail have a higher Conforming Loan Limit. In these regions the maximum loan amount is referred to as a High Balance Conforming area. The largest loans in the High Balance Conforming world reach up to $636,150.

 

Many states do not have any areas that are High Balance Conforming areas, but in Colorado we have several. Eagle County (home of Beaver Creek and Vail ski resort areas) and Pitkin County (known for the Aspen ski area) have the highest High Balance Conforming loan limits of $636,150 as of 2017.

In Summit county (the home of Arapaho Basin, Breckenridge, Copper Mountain and Keystone ski areas) the High Balance Conforming limit has not changed and remains at $625,500.

In Colorado, there are many areas when you don't have to get a JUMBO mortgage

What if your loan amount is greater than $424,100? Do you have to get a JUMBO loan? No, just check the High Balance Conforming limits for the Colorado county where your home is located when purchasing or refinancing.

If you are buying a home Denver, Boulder, Colorado Springs of Fort Collins... you can get a larger loan than most of the USA at the lower interest rates of a "Conforming" of "High Balance Conforming" loan that Fannie Mae and Freddie Mac will buy. Additionally, you might also be able to buy more home at the best rates by using a "Piggyback" second Home Equity Loan to make up the difference between your down payment and the maximum Conforming or High Balance Conforming limits in the county you are buying in.

Structuring Home Loans to "Keep it High Balance Conforming":

Here are just 2 examples illustrating how to avoid JUMBO interest rates using a bigger down payment or the use of a 2nd "Piggyback" loan.

  • $848,200 Purchase Price
  • $636,150 (75% of Purchase Price) Maximum High Balance Conforming 1st Mortgage in Eagle County, Colorado
  • $212,050 (25% of the Purchase Price) Down Payment
    (to keep the 1st Mortgage from exceeding the 2017 High Balance Conforming Limit for 017 Eagle County, Colorado)

(or)

  • $848,200 Purchase Price
  • $636,150 (75% of Purchase Price) Maximum High Balance Conforming 1st Mortgage in Eagle County, Colorado
  • $33,481 (5% of Purchase Price) Down Payment
  • $159,037 (20% of Purchase Price) HELOC 2nd Loan
    (the 2nd "Piggyback" Home Equity Loan can be structured with an "Interest Only" payment for up to 10 years with some lenders)

Not all High Balance Conforming mortgages are created equally

Often conventional lenders add extra requirements to a loan program before they will approve a borrower. Commonly you might see one bank having a higher FICO score to get approved because of the "Overlay" to the loan program. Also, banks may have different interest rates, or the same interest rate as another bank but offer less money in "points" to cover some or all of the borrowers closing costs. It pays to shop when getting a home loan, not only for hazard insurance and title costs, but interest rates an closing costs.

The advantage Mortgage Brokers have over Bank Loan Officers is simple. Brokers have more choices of lenders to choose from allowing the broker to get the best interest rates and terms that fit the home buyers needs. For example, a broker might have the ability to do a High Balance mortgage at the same interest rate than a big bank with the ability to cover more of the closing costs with the "extra money" in points for that rate. Recently, a buyer was able to get a 3.75% interest rate on an FHA 30 year fixed loan with enough "points" at that rate to cover almost $5,000 of closing costs when the big banks were only able to offer the 3.75% rate with no money to cover closing costs.