Sweat equity

A program that gives a buyer part or all of the money for a down payment in exchange for hours of labor helping to build the home.

Sweat equity allows you strike a deal with a homebuilder to exchange hours of hard labor for 5% to 10% of your down payment. Depending on your skill set, you can do a range of construction jobs such as sand and paint walls, nail down floorboards and fit bathroom tiles.

Lenders find sweat equity programs risky because buyers often don't follow through on the amount of work required.

Jumbo loan

Any loan that allows you to borrow more than an amount set by the Federal National Mortgage Association (Fannie Mae)

If you want to borrow over $240,000 for a single-family home, or over $307,100 for a two-family home in the continental US, you have to apply for a jumbo loan. In Hawaii and Alaska, you need a jumbo loan if you plan to borrow over $360,000 for a single-family home or over $460,650 for a two-family home.

Most commercial lenders agree to use these guidelines, which are set by the Federal National Mortgage Association. Jumbo loans have higher interest rates and fewer financing options, and are also called non-conforming loans.