If you want to buy a new home at an above-average price, then the value of the property might fall outside the conforming loan limits given to conventional mortgages. If the property will cost more than these limits, then you might not get a regular home loan for the whole amount.

While you can use other financial products to raise the extra money you need, you can also apply for a non-conforming jumbo mortgage loan. These loans give you access to higher amounts of borrowing.

While jumbo mortgages work like any other home loan, they do have some differences. What are they?

Valuations

Mortgage lenders base home loan offers on a valuation of the property that they find acceptable. This valuation can be more important with jumbo home loans.

Lenders are more likely to run their own appraisals on high-value properties. They rely on their own valuations more.

This doesn't have to be a problem. If a mortgage provider agrees with your valuation, then you can go ahead with your application for a jumbo loan.

However, if they think that the property is worth less than you'll pay for it, and this value takes you under the conforming loan limit, then you might not get full financing in one mortgage loan. Some lenders might limit your mortgage to their valuation sum; some might ask you to switch to a conventional home loan.

Tip: If you are close to the limit, it's worth talking to lenders before you apply for the loan to find out what your options would be if this happens.

Credit Scores

All mortgage lenders pay attention to your credit score. Typically, if you want to borrow more money in a jumbo home loan, then you'll need a really good credit score to mitigate the lender's higher risk.

However, you can sometimes still get a jumbo loan even if your credit rating isn't impeccable. Some lenders will work with you here.

For example, they might ask you for a larger down payment or to buy private mortgage insurance to guarantee your borrowing. They might take other assets or income into account.

Keep in mind that you look better financially if your debt-to-income ratio is healthy. You'll also likely be asked to put aside cash reserves to cover mortgage payments for a set period, say for a year, before the loan is approved.

Tip: If your credit rating isn't perfect, then do some research into lenders that offer jumbo home loans to see their required scores.

For more advice, have an informal chat with a mortgage company that offers jumbo home loan services.