In which scenario is a borrower most likely to need a jumbo loan?

A jumbo loan is specifically designed for situations where the loan amount exceeds the limits set by the conforming loan guidelines established by the Federal Housing Finance Agency (FHFA). In the context of this question, purchasing a luxury home typically falls into the category of properties that have price points exceeding these conforming limits.

Therefore, when a borrower is looking to buy a luxury home that costs more than the conforming loan limit, they would need to secure a jumbo loan to finance that purchase. Jumbo loans often carry higher interest rates and require stricter underwriting criteria, reflecting the increased risk to lenders for amounts that extend beyond the conventional limits.

In contrast, the other scenarios presented involve loan amounts that are likely within the conforming limits, making them unsuitable for a jumbo loan.