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A jumbo loan is a home mortgage loan that exceeds maximum dollar limits set by the Federal Housing Finance Agency (FHFA). Loans that fall within the limits are called conforming loans. Loans that exceed them are jumbo loans.

Jumbo mortgages may be needed by buyers in areas where housing is expensive, and they’re also popular among lovers of high-end homes, investors, and vacation home seekers.

What Is a Jumbo Loan?

To understand jumbo home loans, it first helps to understand the function of Freddie Mac and Fannie Mae. Neither government-sponsored enterprise actually creates mortgages; they purchase them from lenders and repackage them into mortgage-backed securities for investors, giving lenders needed liquidity.

Each year the FHFA sets a maximum value for loans that Freddie and Fannie will buy from lenders — the so-called conforming loans.

Jumbo Loans vs Conforming Loans

Because jumbo home loans don’t meet Freddie and Fannie’s criteria for acquisition, they are referred to as nonconforming loans. Nonconforming, or jumbo, loans usually have stricter requirements because they carry a higher risk for the lender.

Jumbo Loan Limits

So how large does a loan have to be to be considered jumbo? In most counties, the conforming loan limits for 2025 are:

•  $806,500 for a single-family home

•  $1,032,650 for a two-unit property

•  $1,248,150 for a three-unit property

•  $1,551,250 for a four-unit property

The limit is higher in pricey areas. For 2025, the conforming loan limits in those areas are:

•  $1,209,750 for one unit

•  $1,548,975 for two units

•  $1,872,225 for three units

•  $2,326,8875 for four units

Given rising home values in many cities, a jumbo loan may be necessary to buy a home. Teton County, Wyoming, for instance, has an average home value of $2,219,744 and a conforming loan limit of $1,209,750.

Recommended: The Cost of Living By State

Qualifying for a Jumbo Loan

Approval for a jumbo mortgage loan depends on factors such as your income, debt, savings, credit history, employment status, and the property you intend to buy. The standards can be tougher for jumbo loans than conforming loans.

The lender may be underwriting the loan manually, meaning it’s likely to require much more detailed financial documentation — especially since standards grew more stringent after the 2007 housing market implosion and during the pandemic.

Lenders generally set their own terms for a jumbo mortgage, and the landscape for loan requirements is always changing, but here are a few examples of potential heightened requirements for jumbo loans.

•  Your debt-to-income (DTI) ratio. This ratio compares your total monthly debt payments and your gross monthly income. The figure helps lenders understand how much disposable income you have and whether they can feel confident you’ll be able to afford adding a new loan to the mix.

To qualify for most mortgages, you need a DTI ratio no higher than 43%. In certain loan scenarios, lenders sometimes want to see an even lower DTI ratio for a jumbo loan, or they may counter with less favorable loan terms for a higher DTI.

•  Your credit score. This number, which ranges from 300 to 850, helps lenders get a snapshot of your credit history. The score is based on your payment history, the percentage of available credit you’re using, how often you open and close accounts such as credit cards, and the average age of your accounts.

To qualify for a jumbo loan, some lenders require a minimum score of 700 or higher for a primary home, or up to 760 for other property types. Keep in mind that a lower score doesn’t mean you won’t be able to get a jumbo loan. The decision depends on the lender and other factors, such as the loan program requirements, your debt, down payment amount, and reserves.

•  Down payment. Conforming mortgages generally require a 20% down payment if you want to avoid paying private mortgage insurance (PMI), which helps protect the lender from the risk of default.

Historically, some lenders required even higher down payments for jumbo mortgages, but that’s not necessarily the case anymore. Typically, you’ll need to put at least 20% down, although there are exceptions.

A VA loan can be used for jumbo loans. For borrowers with full entitlement, the Department of Veterans Affairs will insure any size loan. For those with partial entitlement, it will insure the part of the loan that falls under conforming loan limits minus anything still owed to the VA. The loan may be available from some lenders with nothing down and no PMI. VA loans have a one-time “funding fee,” though, which is a percentage of the amount being borrowed.

•  Your savings. Jumbo loan programs often require mortgage reserves, money or assets borrowers could use to cover their housing costs. The number of months of PITI house payments (principal, interest, taxes, insurance), plus any PMI or homeowner association fees, needed in reserves after loan closing depends on many factors. For a jumbo loan, some lenders may require reserves of six to 24 months of housing payments.

You don’t necessarily need to have all the money in cash. Part of mortgage reserves can take the form of a 401(k), stock portfolios, mutual funds, money market accounts, and simplified employee pension accounts.

Also, depending on the loan program, a lender may be comfortable with lower cash reserves if you have a high credit score, low DTI ratio, a high down payment, or some combination of these things.

•  Documentation. Lenders want a complete financial picture for any potential borrower, and jumbo loan seekers are no exception. Most lenders operate under the “ability to repay” rule, which means they must make a reasonable, good-faith determination of the consumer’s ability to repay the loan according to their terms. Applicants should expect lenders to vet their creditworthiness, income, and assets.

Jumbo Loan Rates

You might assume that interest rates for jumbo loans are higher than for conforming loans since the lender is putting more money on the line.

But jumbo mortgage rates fluctuate with market conditions. Jumbo mortgage rates can be similar to those of other mortgages, but sometimes they are lower.

Because the absolute dollar figure of the loan is higher than a conforming loan, it is reasonable to expect closing costs to be higher. Some closing costs are fixed, such as a loan processing fee, but others, such as title insurance, are tiered based on the purchase price or loan amount.

Pros and Cons of Jumbo Loans

Benefits

Because a jumbo loan is for an amount greater than a conforming loan, it gives you more options for ownership of homes that are otherwise cost-prohibitive. You can use a jumbo loan to purchase all kinds of residences, from your main home to a vacation getaway to an investment property.

Drawbacks

Due to their more stringent requirements, jumbo loans may be more accessible for borrowers with higher incomes, strong credit scores, modest DTI ratios, and plentiful reserves.

However, don’t assume that jumbo loans are just for the rich. Lenders offer these loans to borrowers with a wide variety of income levels and credit scores.

Lender requirements vary, so if you’re seeking a jumbo loan, you may want to shop around to see what terms and interest rates are available.

The most important factor, as with any loan, is that you are confident in your ability to make the mortgage payments in full and on time over the long term.

How to Qualify for a Jumbo Loan

To qualify for a jumbo loan, borrowers need to meet certain jumbo loan requirements. You’ll likely need to show a prospective lender two years of tax returns, pay stubs, and statements for bank and possibly investment accounts. The lender may require an appraisal of the property to ensure they are only lending what the home is worth.

Is a Jumbo Loan Right for You?

You’ll need to come up with a large down payment on a property that merits a jumbo loan, and some of your closing costs will be higher than for a conventional loan. But depending on where you wish to buy, the cost of the property, and the amount you wish to borrow, a jumbo loan may be your only choice for a home mortgage loan. It’s a particularly attractive option if you have good credit, a low DTI, and a robust savings account. And sometimes jumbo home loans actually have lower interest rates than other loans.

What About Refinancing a Jumbo Loan?

After you’ve gone through the mortgage and homebuying process, it could be helpful to have information about refinancing. Some borrowers choose to refinance in order to secure a lower interest rate or more preferable loan terms.

This could be worth considering if your personal situation or mortgage interest rates have improved.

Refinancing a jumbo mortgage to a lower rate could result in substantial savings. Since the initial sum is so large, even a change of just one percentage point could be impactful.

Refinancing could also result in improved loan terms. For example, if you have an adjustable-rate mortgage and worry about fluctuating rates, you could refinance the loan to a fixed-rate home loan.

Recommended: Guide to Buying, Selling, and Updating Your Home

Jumbo Loan Limits by State

The conforming loan limits set by the Federal Housing Finance Agency can vary based on the county where you are buying a home.

In most areas of the country, the conforming loan limit for a one-unit property increased to $806,500 in 2025 (the amount rises for multiunit properties). The chart below shows exceptions to the $806,500 limit by state and county.

The Takeaway

What’s the skinny on jumbo loans? They’re essential for buyers of more costly properties because they exceed government limits for conforming loans. Luxury-home buyers and house hunters in expensive areas may turn to these loans, but they’ll have to clear the higher hurdles involved.

SoFi can help you save money when you refinance your mortgage. Plus, we make sure the process is as stress-free and transparent as possible. SoFi offers competitive fixed rates on a traditional mortgage refinance or cash-out refinance.

FAQ

What are jumbo loan requirements?

Jumbo loans typically require a credit score of at least 700, a low DTI, and a down payment of at least 20%, although there are always exceptions.

What is the difference between a jumbo loan and a regular loan?

A jumbo loan is a home mortgage loan that exceeds maximum dollar limits set by the Federal Housing Finance Agency. Jumbo loans are typically used by buyers in regions with higher-priced housing but are also popular among luxury homebuyers and investors.

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Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

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Renting a car with a debit card is possible at certain car rental agencies, but you may have to jump through a few additional hoops, such as paying a large deposit or undergoing a credit check. Agencies may also impose certain restrictions, such as being over age 25 and having a debit card with a Visa or Mastercard logo.

Here are key things to know about renting a car with a debit card, including which companies accept debit cards, the pros and cons of using debit vs. credit, and alternatives ways to pay for a rental car.

Is It Possible to Rent a Car With a Debit Card?

So, can you use a debit card to rent a car? Yes! You’ve just got to find rental car agencies that accept debit cards. Though company policies can change, and also vary by location, these are among the agencies that typically allow drivers to rent a car without a credit card:

•   Alamo

•   Avis

•   Budget

•   Dollar

•   Enterprise

•   Hertz

•   Thrifty

Keep in mind that rental car companies that accept debit cards often have additional requirements and restrictions for customers who choose to pay this way.

For example, the company might require a large security deposit and run a credit check on you. You may also have to provide multiple forms of identification, be at least 25 years old, and/or have a debit card with a common logo, like Mastercard, Visa, American Express, or Discover. Airport rental agencies may have additional requirements for renting a car with a debit card, such as proof of return travel.

In addition, the rental company will likely place a debit card hold (equivalent to the total estimated cost of the rental, plus some extra funds for security), which will limit the funds available in your checking account. The hold on the account will be removed after the car is returned and all fees are paid.

It’s a good idea to call the specific location where you hope to rent a car using a debit card. You can then make sure you understand what requirements must be met in order to reserve and pay for the car. In some cases, a rental agency will allow you to use your debit card to pay your final rental bill after you return the car, but require a credit card to make the car reservation.

Recommended: Cheapest Ways to Rent a Car

Why Do Many Car Rental Companies Require a Credit Card?

While many rental car companies will let you rent a car with a debit card, they generally prefer that you use a credit card. The reason is that credit cards offer multiple types of assurances to a rental car agency. For starters, a credit card signals to them that you are trustworthy and responsible — two traits that a company might value before lending you a $25,000+ piece of heavy machinery.

Credit cards also enable rental car companies to collect money for any repairs, tickets, tolls, and other fees. Because of the open line of credit on the card, the rental agency knows it can charge you for incidentals as necessary — without requiring a large security deposit from you up front.

Recommended: Can You Use a Debit Card Online?

Pros of Renting a Car With a Debit Card

Renting a car with a credit card certainly seems easier, but are there advantages to using a debit card? Definitely. Here are some of the pros of using a debit card to rent a car:

•   No credit card necessary: The biggest advantage is also the most obvious. If you can’t qualify for a credit card or simply don’t want one, using a debit card allows you to rent a car without needing a line of credit.

•   No credit card interest: If you pay your credit card off in full each month, you probably aren’t worried about credit card interest. But if you suddenly have a major charge for a car rental, you might be tempted to just make your minimum payment on your credit card — and rack up interest. By paying with a debit card, you don’t risk accruing credit card interest.

•   No impact on credit utilization: High credit utilization can drive down your credit score. By using a debit card, you won’t tap into any of your available credit. However, if the agency runs a credit check for debit card users, the hard inquiry could impact your credit score temporarily.

Cons of Renting a Car With a Debit Card

Though it’s possible to rent a car with a debit card, this payment method can have drawbacks. Here are some of the biggest downsides of renting a car with a debit card:

•   Fewer perks: By swiping your debit card, you may be missing out on credit card travel insurance offered to cardmembers. If you have a rewards credit card that earns cash back or points for every purchase, you may also be leaving money on the table by using a debit card.

•   Security deposit: When using a debit card, you’ll often have to pay the full cost of the rental up front. On top of that, an agency may hold additional funds as a security deposit. This could reduce the cash you have available to spend while on your travels.

•   Credit check: Without a credit card, the rental car agency may perform a credit check before handing over the keys. This can result in a hard inquiry on your credit report.

•   More hoops to jump through: In addition, rental agencies may require multiple forms of ID, might have age requirements, and may even need to see proof of scheduled return travel to allow you to pay with a debit card.

Is It Better to Rent a Car With a Debit or Credit Card?

Do you need a credit card to rent a car? Not necessarily. If you cannot qualify for a credit card or do not want one, renting with a debit card may be the right choice for you.

That said, using a credit card can offer some perks. Doing so is likely the better approach for many drivers since it won’t require putting a large hold on the funds in your bank account, may have built-in car insurance, and won’t necessitate a credit check by the agency.

Is It Safer to Rent a Car With a Debit or Credit Card?

Renting a car with a credit card is generally safer than renting a car with a debit card. One reason is that it can be more challenging to dispute charges with a debit card compared to a credit card. In addition, your credit card may also offer rental car insurance as part of its perks, meaning extra protection on the road.

Alternatives to Car Rentals With Debit Cards

While you can use a debit card to rent a car, here are some alternative payment options you may want to consider:

•   Using a credit card: The main alternative is paying for a car rental with a credit card. In fact, this is usually the better option for the driver and the rental agency.

•   Riding with another driver: If someone else in your party has a credit or debit card and is willing to pay for the rental, let them get behind the wheel. Many companies allow customers to add additional drivers to the rental contract, though it may involve a fee.

•   Paying with a prepaid card or cash: While rental car agencies will likely require a credit or debit card to secure the rental, some agencies may allow you to pay with a prepaid card, money order, or even cash at the end of the rental agreement — once the car has successfully been returned.

Recommended: Common Misconceptions About Money

Ways to Protect Yourself While Renting a Car

Renting a car can be stressful, but it also enables you freedom to travel, allows you to put miles on a car that isn’t yours during road trips, and may come in handy when your vehicle is being worked on. Here’s how you can protect yourself when renting a car:

•   Research the car before driving it: Once you know the year, make, model, and trim of your rental, you can research it online to understand any nuances to how it works, especially if you aren’t accustomed to newer safety technologies. The owner’s manual should be in the glove compartment and is worth reviewing if you’re uncomfortable driving an unfamiliar vehicle.

•   Carry insurance: Before renting a car, it’s a good idea to check with your car insurance agent and your credit card company to see what coverage you have. If you don’t have coverage for the rental through any other means, make sure you opt in for the insurance offered by the rental agency.

•   Follow the rules of the road: You should always abide by traffic laws, but they’re especially important when you’re learning a new vehicle. If you’re traveling in a foreign country, it’s a good idea to study their laws and traffic signs at home before your trip.

The Takeaway

Renting a car with a debit card is possible, but you’ll miss out on some of the perks of paying with a credit card — like potential cashback rewards and car insurance. Plus, rental agencies may require you to fulfill more requirements to get behind the wheel, like paying a security deposit or agreeing to a credit check.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

Which rental car companies allow you to use a debit card?

Alamo, Avis, Budget, Dollar, Enterprise, Hertz, and Thrifty are just some of the rental car companies that allow you to pay with a debit card. However, these and other rental car companies may have stricter rules and requirements for renting a car with a debit card vs. a credit card, such as requiring a credit check or a larger security deposit.

Are there any restrictions when renting a car with a debit card?

Each rental car company may have its own restrictions when you rent a car with your debit card. For example, they may require you to be 25 or older, pay a large security deposit, and/or agree to a credit check. It’s a good idea to call the specific agency before arriving to understand what you’ll need in order to rent a car with a debit card.

What is the process of renting a car with a debit card?

Rental agencies have varying processes for renting a car with a debit card. It’s a good idea to check online and even to call the specific agency to understand the process ahead of time. In general, companies may require full payment plus a security deposit up front, they may run a credit check, and they might want to see multiple forms of identification. If you’re renting at an airport, they may also require you to provide proof of a return plane ticket.

Photo credit: iStock/Khaosai Wongnatthakan

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2025 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

SoFi members with Eligible Direct Deposit activity can earn 3.80% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below).

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning 3.80% APY, we encourage you to check your APY Details page the day after your Eligible Direct Deposit arrives. If your APY is not showing as 3.80%, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning 3.80% APY from the date you contact SoFi for the rest of the current 30-day Evaluation Period. You will also be eligible for 3.80% APY on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi members with Eligible Direct Deposit are eligible for other SoFi Plus benefits.

As an alternative to Direct Deposit, SoFi members with Qualifying Deposits can earn 3.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Eligible Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving an Eligible Direct Deposit or receipt of $5,000 in Qualifying Deposits to your account, you will begin earning 3.80% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Eligible Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Eligible Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Eligible Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Eligible Direct Deposit or Qualifying Deposits until SoFi Bank recognizes Eligible Direct Deposit activity or receives $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Eligible Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Eligible Direct Deposit.

Separately, SoFi members who enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days can also earn 3.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. For additional details, see the SoFi Plus Terms and Conditions at https://www.sofi.com/terms-of-use/#plus.

Members without either Eligible Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, or who do not enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days, will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 1/24/25. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.
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