Jumbo loan is a type of financing that exceeds the limits set by the FHAH. Unlike conventional loan, jumbo loan cannot be guaranteed or securitized by Fannie and Freddie, meaning the lender is not protected from losses if a borrower defaults. Jumbo loans are designed to finance properties and homes in highly competitive local real estate markets. It is available with either a fixed rate interest rate or an adjustable rate, and they come with a unique requirements and tax implications.