What type of loan exceeds the lending limits established by Fannie Mae and Freddie Mac?

A Jumbo Loan is a type of mortgage that exceeds the conforming loan limits set by Fannie Mae and Freddie Mac. These limits are established to define the maximum loan amount that can be sold to the two government-sponsored enterprises without additional requirements. Because Jumbo Loans do not conform to these limits, they are not eligible for purchase by Fannie Mae or Freddie Mac, which usually affects the terms and interest rates of such loans. Borrowers pursuing a Jumbo Loan often face stricter credit requirements and documentation standards because the lenders take on more risk by financing larger amounts of money beyond the conforming limits.

In contrast, other options listed fall outside this specific criterion. A Junior Mortgage typically refers to any secondary loan taken against a property that already has a primary mortgage, while an Insured Mortgage may be related to loans backed by government insurance, such as FHA loans, which still adhere to set limits. A Lease-Purchase Mortgage Loan is a type of agreement that combines a lease and an option to buy, but it does not pertain to exceeding the lending limits of conventional loans. Thus, it is clear why a Jumbo Loan is the correct answer to this question.