Jumbo mortgage loans are used for financing properties that exceed the conforming loan limits set by government-sponsored enterprises like Fannie Mae and Freddie Mac. Because these loans are not eligible for purchase by these entities, they carry more risk for lenders, which is reflected in their stricter credit requirements and higher down payment expectations. Jumbo loans are ideal for purchasing or refinancing luxury homes or high-cost properties and offer flexible terms and competitive interest rates for borrowers with strong credit profiles.