Jumbo Loans in the Lehigh Valley: What Buyers Should Know
Most Lehigh Valley homes can be financed with a standard conforming mortgage, but some purchases call for a larger loan. If you’re looking at a larger home, a custom build, or a restored historic property in the Easton or Bethlehem area, you may hear the term “jumbo loan.”
Jumbo loans work a little differently from conventional loans, and the guidelines are often stricter. Understanding the basics before you start shopping can help you plan your down payment, your budget, and your timeline.
I’m Rich Sywensky, a Senior Loan Officer at RHMC and a lifelong Lehigh Valley resident. When I work with buyers, I use real numbers so the decision is clear. If you’re considering a jumbo loan, these are ten questions to guide you.
Table of Contents
1. What Is a Jumbo Loan?
Quick Answer: A jumbo loan is a mortgage that is larger than the conforming loan limit set by the Federal Housing Finance Agency (FHFA). Because jumbo loans exceed Fannie Mae and Freddie Mac limits, they are considered non-conforming and follow each lender’s own guidelines.
Conforming loans can be purchased by Fannie Mae and Freddie Mac, which is part of why guidelines tend to be more standardized. Jumbo loans fall outside those limits, so lenders set their own rules for credit, down payment, reserves, and documentation.
It is important to remember that the limit applies to the loan amount, not the purchase price. A $1,000,000 home with a large down payment may still produce a conforming loan, while a smaller home with a small down payment may not.
2. What Is the Jumbo Loan Limit in the Lehigh Valley?
Quick Answer: For 2026, the baseline conforming loan limit for a one-unit property is $832,750. Lehigh County and Northampton County are not designated high-cost areas, so a loan above that amount is generally considered a jumbo loan in both counties.
The FHFA updates the limit each year based on home price changes. For 2026, it rose $26,250 from the 2025 limit of $806,500. In certain high-cost parts of the country, the limit is higher, but that does not apply to the Lehigh Valley.
Limits are higher for properties with two to four units, so it is a good idea to confirm the limit for your specific property type. You can also check the FHFA’s county-by-county table to confirm the figure for the property you are considering in Easton, Bethlehem, or the surrounding area.
3. When Might a Lehigh Valley Buyer Need a Jumbo Loan?
Quick Answer: A jumbo loan may be needed when your loan amount, after your down payment, is above $832,750. In the Lehigh Valley, that tends to apply to higher-priced properties such as larger homes, newer custom construction, and restored historic properties.
Many Lehigh Valley purchases fall well below the jumbo threshold, so jumbo financing is typically a fit for a smaller share of buyers. Here are a few illustrative examples using round numbers:
A $1,000,000 home with 20% down ($200,000) results in an $800,000 loan, which is under the 2026 limit and would generally be a conforming loan
A $1,100,000 home with 20% down ($220,000) results in an $880,000 loan, which is $47,250 over the limit and would generally be a jumbo loan
A $1,100,000 home with 10% down ($110,000) results in a $990,000 loan, which would also generally be a jumbo loan
These are examples only, not specific properties or quotes. Properties in places like Easton’s College Hill area or Bethlehem’s historic districts, as well as larger homes in nearby townships, can fall in this range depending on size, condition, and location.
4. What Down Payment and Credit Score Do Jumbo Loans Require?
Quick Answer: Jumbo loans often require a larger down payment and a stronger credit profile than conforming loans. Exact requirements vary by lender, and many lenders look for a down payment of 10% to 20% or more and a higher credit score.
Because jumbo loans are not backed by Fannie Mae or Freddie Mac, lenders take on more of the risk and often set stricter standards. In general, you may be asked to show:
A larger down payment than a low-down-payment conventional loan
A higher minimum credit score, with many lenders looking for scores in the 700s or higher
A stable and well-documented income history
A lower debt-to-income ratio than some other loan programs allow
Guidelines differ from one lender to the next, so the same borrower may see different requirements from different lenders. Comparing options early can help you avoid surprises.
5. What Other Qualification Requirements Apply?
Quick Answer: Beyond down payment and credit, jumbo lenders often look at cash reserves, assets, income documentation, and the appraisal. The larger loan amount typically means a closer review.
Common items that may come into play include:
Cash reserves: funds you would have remaining after closing, often measured in months of mortgage payments
Asset documentation: statements for bank, retirement, and investment accounts
Income documentation: pay stubs, W-2s, tax returns, and for self-employed borrowers, business records
Appraisal: some jumbo loans may require additional valuation steps, depending on the lender and loan amount
Property type and condition: unique, larger, or older properties may receive added review
Keep in mind that reserves are in addition to your down payment and closing costs. Property taxes and homeowners insurance will also affect your overall budget, and property taxes in Lehigh and Northampton counties vary by municipality and school district.
6. How Do Jumbo Rates and Costs Compare?
Quick Answer: Jumbo rates can be higher than, similar to, or even lower than conforming rates, depending on the lender and market conditions. The larger loan amount also means a larger monthly payment, even at the same rate.
Historically, jumbo loans were priced higher than conforming loans, but the gap changes over time, and some lenders price jumbo loans competitively. Because it varies, comparing offers is important.
The $47,250 difference between an $832,750 loan and an $880,000 loan adds roughly $300 per month in principal and interest, before considering any difference in rate. Lender fees and closing costs can also differ, so review each Loan Estimate carefully.
7. What Jumbo Loan Options Are Available?
Quick Answer: Jumbo loans may be available as fixed-rate mortgages and adjustable-rate mortgages, depending on the lender. Terms and programs vary, so it is worth asking what each lender offers.
Options that may be available include:
Fixed-rate jumbo loans, such as 30-year and 15-year terms
Adjustable-rate jumbo loans, such as 7/6 or 10/6 ARMs
Jumbo loans for primary residences
Jumbo loans for second homes, with different guidelines
Jumbo refinance options
If you are weighing a fixed-rate loan against an ARM, our guide on fixed-rate vs. adjustable-rate mortgages in the Lehigh Valley explains how each works. With a larger loan balance, even a small change in rate can have a bigger dollar impact, so it helps to understand the highest payment an ARM could reach.
8. Can I Avoid a Jumbo Loan?
Quick Answer: Sometimes. Options may include a larger down payment to bring the loan under the limit, a second mortgage alongside a conforming first mortgage, or adjusting your price range. Whether any of these is better than a jumbo loan depends on your situation.
Using the $1,100,000 example from above, the loan would be $832,750 or less if the down payment were at least $267,250, or about 24% of the price. That would bring the loan to the conforming limit.
Strategies buyers sometimes consider include:
Increasing the down payment to reduce the loan amount
Using a piggyback structure, with a conforming first mortgage and a smaller second loan
Adjusting the purchase price or timing
Comparing a jumbo loan against the conforming option to see the real cost difference
Staying under the limit is not always the better choice. A second loan may have a different rate and payment structure, and a larger down payment ties up more cash. It helps to compare the full picture.
9. Can I Use a Jumbo Loan for a Second Home, Investment Property, or Refinance?
Quick Answer: Many lenders offer jumbo financing for second homes and refinances, and some offer it for investment properties, though guidelines are typically stricter and vary widely by lender.
If you own a property in the Lehigh Valley that has grown in value, or you are buying a second home or rental, a jumbo loan may still be on the table. Compared with a primary residence, you may see:
A larger required down payment or more equity
Higher credit score requirements
More cash reserves
Different pricing
Different documentation, such as rental income for investment properties
If you already have a jumbo mortgage and your balance has dropped, it may now fall under the conforming limit. That could open up different options, so it can be worth reviewing your loan periodically.
10. What Is the Jumbo Loan Process Like?
Quick Answer: The process is similar to other mortgages, but with more documentation and a closer review. Many loans close in approximately 30 to 45 days, although timelines vary by lender and by how quickly documents and the appraisal are completed.
To help the process go smoothly, consider these steps:
Get pre-approved early so you know your budget before you make an offer
Gather your income, asset, and tax documents in advance
Plan for reserves in addition to your down payment and closing costs
Compare Loan Estimates from more than one lender
Ask who handles underwriting and how the lender communicates throughout the process
Because jumbo guidelines are set by each lender, getting started early can give you time to compare your options and make a confident decision.
Ready to Explore Jumbo Loans in the Lehigh Valley?
A larger loan comes with more to consider, and having the right information up front can make the process more comfortable.
Whether you’re buying in Easton, Bethlehem, or elsewhere in the Lehigh Valley, I’m here to help you understand your financing options and what to expect along the way.
Rich Sywensky
NMLS #1834172
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