Jumbo & Non-QM Mortgage Down Payments Explained

Luxury and non-traditional buyers often need creative financing that suits their needs. Jumbo and non-QM loan programs let affluent, self-employed, and “outside-the-box” borrowers win home purchases with less conventional income documentation. Many believe that the tradeoff means a bigger down payment, and while most multi million dollar loans won't let you put 3% down, they also don't require 30% down. In this guide we break down each program’s structure, required down payment, and ideal borrower – with local examples from California, Texas, Virginia, Colorado, Illinois, New Jersey, and Connecticut.

Jumbo Mortgage Basics (10%–20% Down)

Jumbo loans (for loans above conforming limits) traditionally require heftier down payments than conventional loans. Today, many jumbo programs let well-qualified borrowers put only 10% down on a primary residence. For example, one lender’s “near-jumbo” program allows 10% down on loans up to $2 million. However, 20% down is still common (and often needed for best rates). In high-cost markets like California (Bay Area, Los Angeles) or Virginia (Washington suburbs), most lenders expect around 20% on luxury condos, second homes or investment properties. Even in Texas (Austin, Dallas) or Illinois (Chicago’s North Shore), a jumbo program may advertise 10% down, but recommend borrowers plan on ~20% to unlock the lowest rates.

• Primary residences: As little as 10% down in many programs. Better pricing kicks in at 15–20% or more.

• Second homes: Typically treated like primaries, but lenders often stick to 15–20% down (especially if they have condo or resort restrictions).

• Investment properties: Usually demand at least 20% down. Many jumbo lenders impose 25–30% down for second homes or rentals.

• Credit profile: Jumbo borrowers generally need strong credit (700+ FICO) and solid cash reserves, but no single program “requires perfect scores.” A lower score can be offset by extra equity.

For example in Texas: A Dallas buyer may want to qualify for a $1.5M jumbo with 10% down because he plans to spend an additional $150,000 on renovations  . In contrast, a Houston homebuyer might feel comfortable putting 20% don because she wants the best possible rate. R with multiple condos might need 25% down.

Asset Depletion Mortgages (15%–20% Down)

For retirees or high-net-worth individuals living off investments, asset-depletion loans let your cash/stock pile count as income. Lenders “deplete” (divide) your liquid assets over a fixed term to create a faux monthly income, instead of using pay stubs.

• Down payment: Programs typically cap out at 80–85% LTV, meaning 15–20% down. In practice many asset-depletion lenders expect around 15% down for a primary or second home, and ~20% for an investment.

• Who it’s for: Retirees or executives with large savings but little salary. Think a tech exec cashing out retirement funds to buy a vacation home, or a former CEO who earned mostly stock.

• How it works: The lender takes your qualifying assets (bank accounts, stocks, retirement funds) minus the down payment, divides by a set period, and uses that as monthly income.

• Properties: Available for primary homes, second homes, and (in many cases) investment properties.

• State examples: In affluent California markets (LA, Bay Area) or Virginia’s suburbs, borrowers often have big stock portfolios and can use asset-depletion loans to qualify. In Connecticut or New Jersey, retirees with large 401(k)s use this to buy a dream house on the Connecticut coast or a trophy home in Princeton without selling assets. A common scenario: a 62-year-old Texas retiree with $5.6M in accounts qualified for a $3.2M Westlake Hills (Austin) home purely on asset-depletion income.

Bank-Statement Loans (15%–20% Down)

Self-employed or 1099 earners often turn to bank statement loans or self employed mortgages, which qualify you based on cash flow in your accounts. Lenders average 12–24 months of personal or business bank deposits, apply an expense factor, and treat the rest as income.

• Down payment: Generally 15–20%. Many programs advertise 10% down for top-credit borrowers, but in practice 15–20% is more common. For example, a program might say “10% minimum down” but charge higher pricing than a 20% down loan.

• Who it’s for: Entrepreneurs, consultants, freelancers – anyone with strong deposits but low reported income (due to write-offs or new business). In Illinois, a Chicago-based web designer or in Texas a Houston oil-entrepreneur with fluctuating revenue could use their last 2 years of deposits to qualify.

• Loan amounts: Commonly cap around $1–2M. Bank-statement loans are offered for primary and second homes, and often investments too (with 20–30% down).

• Example: A freelance graphic designer moving from Chicago to Houston. With $20K average deposits but low taxable AGI, she qualified for a $1.2M home loan using 12 months of bank statements and no tax returns.

RSU-Based Mortgages (10% Down)

Tech employees who get paid in Restricted Stock Units (RSUs) can sometimes use those grants as qualifying income. Specialized mortgage programs will recognize a steady, vesting RSU schedule on par with salary.

• Down payment: Typically 10% down (90% LTV). In other words, if you’ve got $100K in annual RSU vests at Google or Meta, you may buy a home with just $20K down.

• Who it’s for: Silicon Valley, employees of public companies like Tesla, SFii or Amazon who receive compensation in the form of RSUs or any high-comp firm with equity pay. For example, a software engineer in San Jose or Stamford could use RSUs instead of salary to qualify.

• Qualifying: Lenders typically require vested (not pending) RSUs on a 2-year history or an approved vesting schedule. They convert the average annual vesting into income – similar to how bonus income is treated.

• Example: Consider a tech manager in California or New Jersey who gets $50K/year in RSUs. A lender might allow her to count that as income and extend a jumbo loan with only 10% down.

Crypto-Backed Mortgages (20% Down)

Crypto mortgages let borrowers pledge Bitcoin, Ether, or other digital assets as collateral instead of selling them. These are niche but growing, especially as regulators move to legitimize crypto in lending.

• Down payment: 20% is typical. Some programs even fund 100% of a mortgage against crypto collateral, but those are rare and usually interest-only structures.

• Who it’s for: High-net-worth crypto investors. Think a blockchain startup founder in Texas (Austin’s crypto scene), a Silicon Valley VC in California, or a New York trader (NYC area) with a crypto portfolio. These borrowers can avoid triggering capital gains taxes by using crypto as security.

• Key point: These loans carry higher rates and strict LTV limits to protect against crypto volatility. But the big win is liquidity: you don’t sell your coins, yet you can still buy the $1.5M beach house in Florida or a mansion in Greenwich, CT with crypto on the side.

• Example: A New Jersey resident with $5M of bitcoin wants to leverage his BTC to buy a house. He makes a 20% down payment in cash, then qualifies for the mortgage with his $5M in crypto as collateral using a crypto mortgage

Buy-Before-You-Sell (Bridge) Loans

In pricey areas, many buyers can’t wait to line up buyers for their existing home. A “Buy Before You Sell” (bridging) loan lets you use your departing house’s equity to fund the new purchase. The typical structure:

• Bridge on old home: Lend up to 75% LTV (i.e. 25% equity) on your existing house. The bridge lender usually goes 2nd position behind your first mortgage. For example, if your current home is $1M with $500K mortgage, the lender might give $250K (25% of $1M) as a bridge loan. You pay no interest on this short-term bridge; instead, when your old house sells, the entire bridge balance plus a fee is repaid.

• Down on new home: You still need ~20% down on the new purchase in most cases. In practice you’ll have combined equity sources: part from savings, part from the bridge.

• Who it’s for: Move-up buyers in New Jersey/New York, California, Colorado (hot Denver market), etc. For example, a Fairfield County, CT, family can lock in a Montclair, NJ home with a bridge loan on their Norwalk house. Or a Seattle couple upsizes to a Bellevue mansion before selling their condo, using the condo’s equity as a bridge.

• Example: A Virginia homeowner buys a $800K new home in Arlington before selling his Alexandria condo. He does 20% down ($160K) on the new home from savings, and takes a bridge loan on the condo: up to 75% of its value. If the condo is worth $400K with $200K first mortgage, he could draw $100K (25% of $400K) as bridge.

State-by-State Snapshot

To ground these rules, here are quick examples by state:

• California (CA): Bay Area techies often use RSU loans or asset depletion. A San Francisco engineer with $50K/year RSUs might leverage a 10%-down jumbo to buy a Silicon Valley home. Retiring executives in La Jolla or Napa with $3M in savings often opt for asset-depletion financing (80% LTV primary) to stay liquid. Crypto investors in California have started exploring crypto mortgages, using their Bitcoin holdings to buy a Los Angeles estate (20% down) instead of cashing coins for crypto tax reasons.

• Texas (TX): In booming Austin and Dallas, bank-statement loans are popular. A self-employed Austin startup founder may qualify on 12 months of deposits with as little as 15% down. Dallas retirees with large 401(k)s might use asset depletion at 20% down to buy that golf-course home. Texas investors also use jumbo loans – many firms here originate loans with just 10% down for owner-occupied homes, though 20% is safer for pricing.

• Virginia (VA): In Northern Virginia’s expensive markets (e.g. McLean, Arlington), jumbo loans are the norm. Many VA jumbo programs start at 10% down, but most lenders expect 20% on luxury properties. Self-employed D.C. consultants use bank-statement loans (10–15% down), while retirees with government pensions tap asset depletion for second homes in Richmond or Charlottesville. Crypto-financed buyers are emerging in Arlington too, often sticking to 20% down.

• Colorado (CO): In Denver/Boulder, high earners (tech, outdoors industry) rely on non-QM. A ski-resort entrepreneur with erratic income can buy a Denver home using bank-statement financing with 15–20% down. Millionaires in Telluride often utilize asset depletion for mountain estates (using large brokerage accounts as income). Jumbo loans with 10% down are offered, but in practice 20% down is common in Colorado’s competitive market.

• Illinois (IL): Chicago’s North Shore and Loop see a mix. Attorneys or doctors with side businesses use bank-statement mortgages (dropping 15% down) to buy suburbs without standard W-2s. Tech consultants in downtown Chicago leverage RSU loans from big firms. Many lenders advertise 10% down jumbo options for North Shore buyers, though 20% is strongly advised for best terms. Investors on Lake Michigan’s beaches may combine bridge loans (75% LTV) with savings for that down payment.

• New Jersey (NJ): Commuters who flip from NJ homes to NYC jobs often use the “buy before sell” approach. For instance, a Hoboken resident could lock in a Montclair home by taking 75% LTV on their Jersey City condo and covering 20% down on the new purchase from savings. High-net-worth Jersey residents (hedge funders, pharma executives) increasingly use asset depletion on their liquid wealth to acquire shore properties, usually with 15–20% down. RSU loans are cropping up too: a Princeton biotech executive might buy a Mercer County house with just 10% down using her RSU income stream.

• Connecticut (CT): In Greenwich and Fairfield County, wealthy retirees and bankers use these products often. A Stamford banker may use an RSU loan for a new purchase with 10% down, or pledge part of a stock portfolio via asset depletion. Crypto adoption is lower than, say, TX or CA, but there are CT cases of crypto mortgages for luxury homes (again, 20% down). Bridge loans are popular: many CT sellers buy in CT or even move to Boston/NYC with 75% LTV bridges on their existing CT home.

Who Benefits?

• High-net-worth individuals: Luxury borrowers with 6+ figure incomes or big portfolios avoid selling assets or messing with complicated tax returns. Products like asset depletion and crypto loans let wealth buy homes without liquidation.

• Self-employed professionals: Consultants, freelancers and business owners don’t fit “cookie-cutter” lending. Bank-statement mortgages and 1099 loans let them qualify on real cash flow; non-QM jumbos (with 10–20% down) give them access to expensive properties despite no W-2s.

• Tech and crypto workers: People paid in stock or crypto often prefer keeping those assets. RSU and crypto-backed loans let techies in California or New York leverage their equity compensation or digital coins for home purchases, usually requiring a 10–20% cushion.

• Move-up buyers: Anyone needing to buy before selling can use a buy-before-you-sell bridge loan. These are especially handy in fast markets (Northern NJ, CA, D.C. suburbs) where selling a house can take longer than you’d like.

Program Structures (Quick List)

• Jumbo Loan: 10%–20% down (primary), 20%+ (second/investment). Higher credit and reserves required. Example: San Diego attorney buys a $2M house with 15% down.

• Asset Depletion Loan: 15% down (owner-occupied), 20% down (investment). Qualify on assets (stocks, 401k) instead of income. Example: Silicon Valley retiree uses $4M in mutual funds to get a jumbo on a mountain home.

• Bank-Statement Loan: 10%–20% down (10% if FICO ≥680). Qualify on 12–24 months of deposits. Example: Chicago freelance designer qualifies with 12 months of $20K deposits (15% down) for a $1.2M home.

• RSU Mortgage: ~10% down. Lenders convert vesting stock into qualifying income. Example: Mountain View engineer with $80K/yr in RSUs uses 10% down RSU loan to buy a $1.2M home.

• Crypto-Backed Mortgage: ~20% down. Use BTC/ETH as collateral. Example: Austin investor pledges $2M in Bitcoin to secure an 80% LTV loan on a $2.5M home.

• Buy-Before-Sell Bridge: 75% LTV on existing home (2nd lien), plus ~20% down on new home purchase. Example: Northern Virginia buyer puts 20% down ($200K) on a $1M new house and takes a 75% LTV bridge on his current $400K condo ($100K bridge).

Summary

Jumbo and non-QM loans are all about flexibility. By accepting alternative income documentation or asset collateral, lenders enable high-asset, self-employed, and tech-savvy borrowers to purchase homes they otherwise couldn’t. The catch is that most of these programs insist on sizeable equity from the borrower – typically 10–20% or more.

In practice, expect ~20% down on most non-traditional loans unless you have a stellar profile. A bare-minimum 10% down often targets very strong applicants or owner-occupied scenarios. Second homes and investment properties usually require 20%–25%.

If you’re in California, Texas, Virginia, Colorado, Illinois, New Jersey, or Connecticut, these programs are readily available. A local mortgage broker can match you to the right product. Whether you have RSUs in Palo Alto or crypto in Austin, or you’re a small-business owner in Houston or Chicago, these loans exist to help you achieve homeownership.

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