For custom builds that outgrow conforming and high-balance limits.
When a custom home pushes the loan amount above the conforming or high-balance limit, a jumbo construction loan may be the fit. Ken Clark Jr., Certified Mortgage Advisor with PRMG, helps eligible borrowers in El Dorado Hills, Granite Bay, Bergen County, and nationwide where licensing permits plan jumbo construction financing.
Short answer: it is a construction loan with a loan amount above the conforming or high-balance limit for your county, used to build a custom or higher-priced home.
Loans above the conforming limit cannot be purchased by Fannie Mae or Freddie Mac, which is why they are called jumbo loans. For 2026, the FHFA conforming loan limit is $832,750 for a one-unit home in most counties, and the high-cost ceiling is $1,249,125. More on jumbo loans.
Short answer: when the loan amount, not the home price, exceeds your county's limit. A larger down payment or land equity can keep some builds within conforming or high-balance limits.
| Area (2026) | Conforming or high-balance limit, one unit |
|---|---|
| Most U.S. counties | $832,750 |
| California high-cost counties (for example LA, Orange, Bay Area) | $1,249,125 |
| NJ high-cost counties, including Bergen, Essex, Morris, Monmouth, Somerset | $1,209,750 |
| Sacramento region | Check the county; many counties are between the baseline and the ceiling |
If you are close to a limit, we will compare a jumbo structure with a conventional construction loan using more land equity or cash.
Short answer: expect a larger down payment, stronger credit, fully documented income, and cash reserves, typically more than conforming construction requires, subject to program guidelines.
Underwriters look closely at the builder's budget, the appraisal on plans, and your ability to handle interest during construction. Self-employed borrowers may have additional documentation options depending on the program; see non-QM options. We do not quote specific jumbo construction numbers here because they vary by program and borrower profile.
Short answer: they affect the appraisal most. Custom homes and features like pools, guest houses, or large acreage are valued only as far as comparable sales support them.
In markets with fewer comparable high-end sales, the appraiser may reach farther or adjust heavily. Detailed plans and specs help. See construction appraisal. Because the loan cannot increase after closing on most construction structures, a contingency and reserves matter even more at this price point. See cost overruns.
Short answer: custom homes on larger lots in El Dorado Hills, Serrano, and Granite Bay often exceed local limits, especially with view lots, pools, and outbuildings.
Foothill lots can require significant grading, retaining walls, and utility work, which belong in the builder's fixed-price contract. Builders should hold an active license with the California Contractors State License Board. In California, permits are typically required before a one-time close loan closes. Local guides: El Dorado County construction loans and Placer County construction loans.
Short answer: Bergen County teardowns and new custom homes frequently exceed the $1,209,750 high-cost conforming limit, making jumbo construction a common fit.
Many projects start with an older home on a valuable lot. See knockdown rebuild loans and Bergen County mortgage lender. Municipal zoning and permitting timelines vary by town, so build them into the schedule.
Educational illustration only. Not an actual client, loan offer, or commitment to lend.
A couple owns a view lot in El Dorado Hills worth $450,000, free and clear. Their builder's fixed-price contract is $1,350,000, and the as-completed appraisal is $1,850,000. The loan they need is above the local conforming limit, so we explore a jumbo construction program. Their land equity supplies much of the required down payment, and they keep cash reserves for upgrades and interest during construction, subject to underwriting and program guidelines.
Where available: PRMG construction programs are available in every state where PRMG is licensed, which is all states except New York, including California and New Jersey, subject to eligibility and program guidelines. In California, building permits are typically required before a one-time close loan closes.
Answered by Ken Clark Jr., Certified Mortgage Advisor. Program availability and requirements vary and are subject to change.
A construction loan with a loan amount above the conforming or high-balance limit for the county, commonly used for custom and higher-priced homes.
The baseline for a one-unit home is $832,750, with a high-cost ceiling of $1,249,125. The 12 New Jersey high-cost counties, including Bergen, are at $1,209,750.
Jumbo construction typically requires a larger down payment than conforming construction. Exact requirements depend on the program and borrower profile.
Reserves are typically required. The amount depends on the program, loan size, and borrower profile.
Often yes. Equity in a lot you own may count toward the required investment, depending on program guidelines.
Yes. PRMG programs are available in every state where PRMG is licensed, which is all states except New York, for eligible borrowers.
It may be possible depending on the program. Ask about occupancy rules for your specific plan.
Owner-builder projects are generally not eligible. A licensed builder should act as the general contractor and complete builder registration.
Possibly, if included in the contract and supported by comparable sales in the appraisal.
It depends on your cash, pricing, and goals. We can compare both structures side by side.
Guidelines change. Verify current program requirements with Ken Clark Jr. before relying on them for a transaction.
Disclaimer: This content is for educational purposes only and is not a commitment to lend, a guarantee of approval, or a rate quote. Loan programs, down payment requirements, terms, and eligibility depend on borrower, property, project, builder, and program qualifications, are subject to underwriting, and vary by state. Not all applicants or projects will qualify. Builder registration is a documentation review for program eligibility and is not an endorsement of any builder. Equal Housing Opportunity. Paramount Residential Mortgage Group, Inc. (PRMG), NMLS #75243. Ken Clark Jr., NMLS #225375. PRMG is licensed in 49 states, excluding New York.
Certified Mortgage Advisor and Branch Manager at PRMG Mortgage (NMLS #75243). 28 years in mortgage lending. Specializes in FHA, VA, conventional, DPA, jumbo, Non-QM, renovation, and construction financing for buyers and investors in Sacramento, New Jersey, and nationwide. PRMG is licensed in 49 states, excluding New York. Three-time Gold Award winner for Highly Reviewed Mortgage Team in Sacramento (2023, 2024, 2025). NMLS #225375.
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