Buying a seven-figure home in Boca Raton and weighing cash versus financing? You are not alone. Many luxury buyers want the flexibility of financing but need clarity on jumbo loans, condo rules, and coastal insurance. In this guide, you will learn how jumbo loans work in Palm Beach County, what lenders expect, how to get pre-underwritten, and smart ways to shop lenders for high-end properties. Let’s dive in.
Jumbo basics in Palm Beach County
A jumbo loan is any mortgage that exceeds the Federal Housing Finance Agency’s conforming loan limit for the county where the property is located. Because these loans are not purchased by Fannie Mae or Freddie Mac, they are funded by portfolio lenders and private investors, which changes how they are priced and underwritten.
As of 2024 the baseline conforming limit for a one-unit home was $766,550. Palm Beach County typically follows the baseline unless designated high-cost for a specific year. In practical terms, many Boca Raton purchases above roughly $766,550 may require jumbo financing. Common price bands for local luxury buyers are $1 million and higher, with different lender requirements as loan sizes increase.
The lack of a government-sponsored enterprise guarantee means lenders retain more risk. That usually results in stricter credit, asset, and reserve requirements compared with conforming loans. Pricing can also vary with market conditions and your profile, and private banks may offer relationship-based pricing at larger balances.
What lenders look for
Jumbo underwriting focuses on your capacity to repay and your liquidity. While every lender is different, you will often see the following ranges:
- Credit score. Many programs target 720 or higher for best pricing. Some accept 680 to 720 with added conditions or higher rates.
- Debt-to-income ratio. Typical maximums range from about 43% to 50%, depending on strong compensating factors like significant liquid assets.
- Loan-to-value ratio. Many lenders cap standard jumbo loans at 70% to 80% LTV without mortgage insurance. Some portfolio lenders may allow 85% to 90% with stricter terms.
- Cash reserves. Expect 6 to 12 months of PITI at the lower end and up to 24 months for larger balances, complex properties, or condos.
These are guidelines, not promises. Your specific loan size, property type, and financial profile will drive the final outcome.
Documents you will need
Full documentation is the norm for jumbo loans, especially in Boca Raton’s luxury segment. Be prepared to provide:
- Two years of personal tax returns and, if self-employed, business returns
- W-2s or 1099s when applicable, plus recent pay stubs and employer verification
- 12 to 24 months of bank statements for all liquid accounts
- Brokerage and retirement account statements to verify assets and reserves
- Clear documentation for large deposits and the source of funds, including gift letters if needed
- Proof of reserves that meet lender requirements
- Signed purchase contract, HOA or condo documents, and information on any other real estate owned
- Entity or trust documents if purchasing through an LLC or trust, with the understanding that many lenders require personal guarantees
Alternative programs exist, such as bank-statement loans for self-employed borrowers or asset-depletion qualification. True no-documentation loans are rare with quality jumbo lenders.
Property factors in Boca Raton
Boca Raton luxury properties can add complexity to underwriting and appraisal. Planning for these issues early will keep your deal on track.
- Waterfront and gated communities. Unique features and limited comparable sales can make valuations challenging. Lenders may request larger down payments or a secondary appraisal review.
- Luxury condominiums. Some buildings are considered non-warrantable under agency rules. Jumbo lenders each have their own condo approval standards and will review financials, litigation, commercial exposure, and owner-occupancy ratios.
- Coastal insurance. Flood zones and wind coverage drive qualification and monthly costs. Even outside designated flood zones, lenders may require wind or flood insurance with specific coverage levels.
- Investment or multi-unit properties. Expect lower LTVs, larger reserves, and stricter documentation.
Because appraisal timelines can stretch for high-value homes, schedule the appraisal early in your contingency period and choose a lender that uses experienced luxury appraisers.
Loan structures that fit luxury buyers
Your financing should match your horizon and liquidity goals. Common structures include:
- Fixed-rate jumbo loans. 15-year and 30-year fixed options are popular if you want predictable payments. Top-credit borrowers with strong reserves often see competitive pricing.
- Adjustable-rate mortgages. 5/1, 7/1, and 10/1 ARMs can offer lower initial rates. These are useful if you plan to sell or refinance within the fixed period.
- Interest-only options. Some lenders offer interest-only periods that lower initial payments. Underwriters will stress-test your file for the payment that begins when principal is added.
- Portfolio and private bank loans. Local and regional banks that keep loans on their books may be more flexible on condos, LTV, or documentation, especially for clients with deposits or investments at the bank.
- Bridge and construction-to-permanent financing. Bridge loans can help if your down payment comes from a home you are selling. Custom builds generally require staged draws and a plan for conversion to permanent financing.
- Piggyback seconds. Less common today, but sometimes used to manage LTV or loan size. They add complexity and can increase overall cost.
Cash versus financing in this market
Cash offers can remove appraisal and financing contingencies and may help in competitive scenarios. Financing, however, preserves liquidity and can be cost-effective when rates and terms align with your strategy.
Consider the after-tax cost of borrowing and your opportunity cost for cash. Current federal rules cap the mortgage interest deduction for acquisition debt on many new loans at $750,000. Florida does not have a state income tax, which affects overall tax planning for some buyers. Always consult your tax advisor for guidance tailored to your situation.
Get pre-underwritten confidence
Not all preapprovals are the same. Understanding the difference helps your offer stand out.
- Pre-qualification is an informal estimate based on the information you provide.
- Pre-approval involves a lender review of credit and some documents, which leads to a conditional approval.
- Pre-underwritten approval means an underwriter has reviewed your full file and issued an approval subject only to the property, title, and final verifications. This can shorten timelines and reduce seller concerns, which is valuable in high-end Boca Raton deals.
To prepare, assemble a complete package now. Clear documentation of income, assets, and source of funds is the fastest path to a strong approval.
Your pre-underwrite checklist
Use this list to keep your file organized:
- Two years of personal and business tax returns, plus W-2s or 1099s
- 30 to 60 days of pay stubs, if applicable
- 12 to 24 months of bank, brokerage, and retirement statements
- An asset ledger that summarizes account numbers and balances
- Documentation for your down payment source, including sale proceeds or gift letters
- Government ID and consent to pull credit
- Purchase contract and HOA or condo documents, if available
- Explanations for large deposits, credit inquiries, or any derogatory items
- Entity documents for LLC or trust purchases, including authorized signers
How to shop lenders like a pro
Comparing lenders matters more as balances rise. Go beyond rate quotes and ask pointed questions.
- Do you offer jumbo programs specific to Palm Beach County and what are your LTV and reserve expectations at my loan size?
- Do you hold loans in portfolio or sell them, and how does that affect your flexibility on condos or waterfront properties?
- What credit score, DTI, and reserve levels get your best pricing? Do you allow asset depletion or bank-statement qualification for self-employed buyers?
- What are your total estimated costs, including points, underwriting, appraisal, and third-party fees? What lock periods and float-down options are available?
- What documents do you need for a pre-underwrite and how long is it valid?
- What are your insurance requirements for coastal properties, including wind and flood coverage?
Strategically, it can help to secure more than one pre-underwritten approval from lenders with different models, such as a national lender, a regional portfolio bank, and a private bank. Compare the full cost and the lender’s willingness to commit to conditions in writing.
Timeline and winning the offer
For high-value homes, start appraisal and inspections early within your contingency. Give enough time for a luxury-experienced appraiser and for HOA or condo document reviews. Order insurance quotes early so you can verify coverage limits, deductibles, and premium impact on your DTI and reserves.
If you plan to sell a property to fund your down payment, discuss bridge financing or contingency language so your offer still aligns with seller expectations.
Common pitfalls to avoid
- Non-warrantable condos. Identify project status early or work with a lender that can finance non-warrantable buildings.
- Unexplained large deposits. Every significant deposit needs a paper trail. Missing documentation can delay or derail your closing.
- Appraisal shortfalls. Unique luxury features can be tough to value. Build in appraisal contingencies and have a plan for renegotiation or a larger down payment.
- Underestimating reserves and insurance. Coastal insurance and windstorm deductibles can materially change your monthly cost and your approval.
- Entity purchases. Many jumbo lenders have strict policies for LLCs and trusts. Discuss terms early to avoid surprises.
Work with a Boca Raton ally you can trust
High-end financing does not have to be stressful. With the right plan and a complete file, you can secure a jumbo loan that matches your goals and timeline. When you are ready to explore Boca Raton’s luxury homes, partner with a local team that treats every detail with care and keeps your deal moving from offer to closing.
If you want a private, expert conversation about your next move, connect with the GK Group for a confidential luxury market consultation.
FAQs
What is a jumbo loan in Palm Beach County?
- Any mortgage amount above the county’s conforming loan limit, which followed a baseline of $766,550 for one-unit homes in 2024.
What credit score do I need for a jumbo mortgage in Boca Raton?
- Many lenders target 720 or higher for best pricing, though some accept 680 to 720 with additional conditions or higher rates.
How much down payment is typical for a jumbo loan?
- Standard jumbo options often range from 20% to 30% down, with some portfolio lenders allowing higher LTVs if you meet stricter qualifications.
Can I get a jumbo loan for a non-warrantable condo in Boca Raton?
- Yes, some jumbo lenders finance non-warrantable condos, but project reviews are strict and terms may require larger reserves or lower LTVs.
How do flood and wind insurance affect jumbo approval?
- Lenders factor required flood and wind coverage into your debt-to-income ratio and reserves, which can impact both qualification and monthly cost.
What is a pre-underwritten approval and why does it matter?
- It is an approval issued after an underwriter reviews your full file, leaving only property-related conditions, which can strengthen your offer and shorten timelines.
Are interest-only jumbo loans available in Boca Raton?
- Some lenders offer interest-only jumbo loans or ARMs, typically with careful stress-testing of future payments and stronger reserve requirements.
