Jumbo Mortgages
Jumbo Mortgage Rates: 5/1 ARM Jumbo Mortgage Rates are Historically Low
Recently much of the news regarding jumbo mortgages has been about the limited availability of true jumbo loans as well as the strict underwriting of conforming jumbo mortgage products. Conforming jumbo mortgages are backed by Fannie and Freddie and have a loan limit of to to 729k with higher jumbo loan limits coming in some high cost areas. Conforming jumbo loan limits vary 
from county to county based on median home values.
Jumbo Mortgage Rates are Excellent
True jumbo mortgages, above the conforming jumbo loan limit, are offered by few lenders but are indeed available and at very good rates. Ditech mortgage for instance is offering jumbo mortgage rates as low as 4.375 percent on a 5/1 ARM. Wells Fargo offers jumbo mortgage rates of 5.75 percent 30-years fixed and 5 percent on a 5/1 ARM. These available jumbo mortgage rates show jumbo mortgage rates are better than ever. The trend recently has been for large lenders to aggressively advertise for jumbo mortgages so obviously it must be profitable for them to do so. With home values stabilizing the jumbo loan market should get less risky for banks by the month.
Jumbo Mortgage Rates are Good but what about an Approval?
Jumbo mortgage loans are tough to qualify for nowadays, that's no secret. Typically lenders want at least 20 percent equity in the home, full income documentation, assets showing reserves, excellent credit and more. If you do qualify it may save you a lot of money through a mortgage refinance. If you're looking to buy a home with a jumbo mortgage you'll most likely need a very large downpayment. If you've got the cash to do so a 5/1 ARM could give you a historically low affordable payment per the loan amount.
Current, Accurate, Jumbo Mortgage Rates – Jumbo Loan Rates are Getting Better
True jumbo mortgages, above jumbo conforming mortgage limits of up to $729,750, are being offered at as low as a 5.75 percent interest rate, with average points and fees. Our research of various Lender’s jumbo mortgage rates, including Chase, Wells Fargo, AimLoan.com, GMAC, Ditech and others shows a great variance lender to lender so borrower savvy is key when shopping for the best jumbo mortgage rates.
5/1 ARM Jumbo Mortgage Rates are Very Good
The best option in today’s jumbo mortgage market may be the 5/1 ARM. Believe it or not we found multiple lender’s including DiTech and GMAC offering the jumbo 5/1 ARM just under 4 percent. The index the jumbo 5/1 ARM’s adjustable rate follows after the 5 year fixed interest rate period is the LIBOR index. We advise anyone considering a jumbo 5/1 ARM to take a good look at the LIBOR index, it’s history and analysis of it’s future. Especially if there’s a strong possibility you’ll still be in the loan after the 5 year fixed rate period. That being said we do not recommend, especially on larger loan amounts, a 5 year adjustable rate mortgage for anybody who is going to be in a home for more than 5 years.
Current Jumbo Conforming Mortgage Rates
Current jumbo conforming mortgage rates are averaging about a 1/4 percent higher than normal conforming mortgages. Due to the extremely strict underwriting on the higher loan amounts, insured by Fannie and Freddie, we recommend getting a custom rate quote. There’s lots of modifications to points, fees, and rates based on the risk factors involved with each mortgage. Most of the time lenders are requiring FICO scores in the 700’s and at 30 percent equity.
Higher Interest Rates: Jumbo
Is there some actual signs the real estate market is coming back to life?
So for in 2009 the the mortgage industry has seen it’s lowest interest rates in 50 years. The government has given unprecedented tax credits up to eight thousand dollars just to buy.
Refinancing is showing signs of life with long term mortgage rates in the 4.5% range. Refinancing a loan over $417,000 though may not be so easy. Jumbo mortgages are loans go beyond the limits of conforming loans which are backed by Fannie Mae and Freddie Mac. The maximum loan size is $417,000 for a single family residence which is quite often below the median loan amount in most areas especially in California. The conforming jumbo was created to address this issue and goes up to about $729,000 in some high cost counties.
Before the housing market collapse the difference between jumbo mortgage rates and conforming mortgage rates was as low as .25%. Today, the difference is tremendous and almost 2 1/2 percentage points. Without the good old portfolio lenders like World Savings jumbo loan availability has dwindled as the risk involved dries the ink out of the underwriter’s approval stamps. Jumbo mortgage loans were already consisdered high risk previous to the market collapsing. Today this risk is reflected with higher interest rates. Even though banks are gaining cash from scared investors who put their cash into FDIC insured savings accounts credit remains super tight. The rise in refinance applications on conforming mortgages is just another result of lower interest rates and we can only hope that soon the government takes bold moves to lower the rates and increase the available credit on the once prosperous jumbo loans.
