How much income & down payment for a $1 million mortgage?

Do you have a growing family that needs more space and amenities than what you have in your current home? If you have the necessary income and assets, a home worth $1 million or more may be the right solution.

Acquiring a million-dollar mortgage might seem like a dream scenario. However, it is achievable with the right planning and understanding of your financial requirements. 

Most of us wonder what kind of income and down payment would be needed to purchase such a high-value property. If you've found yourself considering this question, you're in the right place.

You can also start the process of buying your dream home by applying for a mortgage pre-approval.

Indeed, a mortgage exceeding the traditional loan limit, such as a million-dollar mortgage, would demand a jumbo loan or a high-balance loan.

To qualify for a million-dollar mortgage, you will need to show a high income and usually make a down payment. You'll also need to be a low-risk borrower with a qualifying credit score. A low debt-to-income ratio also helps.

You can also consider a conventional high balance loan, which is not the same as a jumbo loan. High balance refers to a high-cost area where agency and government loans will lend at higher amounts. Jumbo loans are loan amounts that exceed the conforming and high-balance limits, which means that they cannot be purchased by a government agency such a Fannie Mae or Freddie Mac.

It’s possible to get a jumbo FHA or jumbo VA loan, but it depends on a lot of factors. The type of loan and the term, your down payment option and your property location are key aspects that you’ll need to understand to determine if government loan programs are available for you. 

In the U.S., government agencies offer loans, but they had a maximum limit of $1,249,125 in 2026 in high-cost areas. You'll need to work with your mortgage lender to understand if a jumbo FHA loan is possible for your situation. Rate does offer VA loans up to $3 million in some cases.

Additionally, some lenders will look for a borrower's DTI (debt-to-income ratio) to be below 43%. While government-backed loans may not fully cover a million-dollar mortgage outside of high-cost areas, other possibilities exist. Knowing your finances and loan requirements can lead to securing your dream home.

A jumbo FHA loan, exceeding low-cost FHA limits, requires a higher-than-average income, qualifying credit and ample savings. 

 Applicants need to show they have a steady income and a credit score of 500 or higher. Down payment options can vary, but typically it's 10%-20% of the home's purchase price, though FHA does allow 3.5% down payment options.

 Additionally, you must guarantee the ability to cover closing costs and any unexpected expenses. These loans are only for buyers who can afford to pay more each month and have a lot of money saved.

A jumbo VA loan allows veterans and military members to buy high-value properties without a large down payment. 

 For a million-dollar mortgage, you'll need a stable income that shows you can comfortably afford mortgage repayments. Even though VA loans don't require a particular credit score, most lenders prefer borrowers with a score of at least 620. However, for a jumbo VA loan, lenders might require a higher score.  Rate does not require a minimum credit score for a VA loan.

 Despite VA loans not mandating a down payment, some lenders might require one for jumbo loans.

• Non-QM loan

A non-QM loan, or non-qualified mortgage loan, is designed for homebuyers who may be missing the usual documents or may be self-employed or have unique income structures. 

Qualified loans are subject to certain restrictions that ensure borrowers can repay their loans. Non-QM loans have more flexible underwriting criteria and may have higher interest rates and fees because they are considered riskier than QM loans. 

However, they may also offer benefits such as lower down payment requirements or more lenient credit score requirements.

• Non-agency loans

Rate’s national and regional non-agency loans could allow borrowers who don’t qualify for jumbo loans such as self-employed homebuyers to borrow up to $10 million.

As a typical standard, your monthly mortgage payment should not exceed 28% of your gross monthly income. If your annual salary is around $225,000 or higher, you might be in the right ballpark, depending on several other factors. 

 Key aspects of your personal finances, such as the size of your down payment and your debt-to-income ratio, will affect how much home you can afford. The amount of assets you have can also play a role in determining if you can afford a mortgage on a million-dollar mortgage. So, make sure to review all aspects of your financial situation before proceeding with such a significant purchase. 

 In addition, the higher your down payment, the lower your mortgage. Saving a lot of money or converting assets for the down payment option can make it easier to afford a million-dollar mortgage. 

 Consulting with a financial adviser is recommended to thoroughly understand your unique circumstances. It makes sense to talk to someone before taking on a potential liability as large as a mortgage of $1 million or more.

If you're in the market for a $1 million mortgage, you're likely wondering how much you need to save for the down payment. 

Financial advisers often recommend a 20% down payment. Therefore, to purchase a home worth a million dollars, you'd generally need a hefty $200,000 for the down payment. 

 However, different mortgage programs could affect the down payment amount. For example, some such as non-agency loan programs can allow for down payment options that start as low as 10%. 

A smaller down payment leads to higher monthly mortgage payments and potentially the need for private mortgage insurance (PMI). PMI protects the lender if the borrower fails to repay the loan. 

Also, your monthly housing expenses, such as mortgage, insurance, and taxes, should not exceed 28% of your total monthly income. 

 To purchase a $1 million home, you must have sufficient income to comfortably cover the monthly mortgage payment. The amount of the payment can vary depending on factors such as the interest rate and term of the loan. It could be more than $5,000 in monthly costs. 

 Moreover, lenders will consider your debt-to-income ratio, which should ideally be below 36%. This ratio considers all of your monthly debts. These debts include car loans, student loans and credit card payments. It also takes into account your planned mortgage payments. 

 The amount of money you need for a down payment depends on factors like the loan type and your financial health. If your dream home costs $1 million, a $200,000 down payment is a good amount to target, but it can vary. A strong income and low debt will make it easier for you to secure a mortgage for a $1 million home.

• Gross income

Income is one of the most critical factors considered by lenders. To purchase a $1 million home, typically, an annual income of at least $225,000 is required. However, this requirement can vary based on several other factors.

• Down payment option

Typically, you need a higher down payment for a more expensive home. You should consider putting down at least $200,000 for a $1 million home, although this can vary depending on the loan program.

• Debit-to-income ratio

Banks look at how much of your income goes toward paying your debts. Having a high debt-to-income ratio may make it more challenging for you to get approved for a mortgage.

• Credit score

A good credit history is essential when applying for a home loan. Lenders favor borrowers with high credit scores because they perceive them as less risky. Good credit scores could also provide borrowers with better interest rates.

• Asset reserves

Lenders may want to see that you have enough assets to cover several months of mortgage payments.

• Employment history

Lenders generally prefer borrowers who have been stable in their jobs for at least two years.

• Market conditions

The demand for homes and interest rates can affect the price and affordability of a $1 million home.

If you already own a home worth $1 million, whether you own it outright or are still paying off your mortgage, you can access your home’s value without selling. Many owners choose to access their home’s value without selling with options like a home equity line of credit (HELOC).

HELOCs let you access up to 90% of the equity you have in your home for a period of time while only needing to pay interest on the amount you borrow. After this time ends, referred to as a draw period, you will enter a repayment period and pay back both your principal loan amount and interest.

The funds from your HELOC or other home equity loans can be used for any expenses that you may have. Home renovations are a popular choice for using home equity as they could improve quality of living and increase a home’s value.

To get approved for a mortgage of $1 million or more, the first step is to obtain a pre-approval. Apply today to start the process. 

 If you meet the requirements, you will receive a pre-approval letter. You will also get an idea of the most money you can borrow for a house. 

 The path to your million-dollar dream home starts with a Rate mortgage pre-approval! 

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_{Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not represent an approval for financing or interest rate guarantee. Refinancing your mortgage may increase costs over the term of your loan. Restrictions may apply.}

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