Are you going to be able to get your jumbo loan at a good interest rate?
According to Holden Lewis, the answer is yes, finally.
Lenders just might be getting serious about underwriting the new conforming jumbo mortgages for more than $417,000. Word is that the new conforming jumbos sport a rate about three-eighths to half of a percentage point higher than rates for conforming loans …
… The new conforming jumbo mortgages officially became available at the beginning of April. But they weren’t priced differently from regular jumbo loans. The lack of a rate differential defeated Congress’s purpose in creating the jumbo conformings. Teeth were gnashed.
On Friday afternoon, Fannie Mae announced that it would buy jumbo conforming mortgages for the same prices as conforming loans. Some investors, and therefore lenders, immediately dropped their rates on conforming jumbos. From what I hear, the new jumbo conforming rates are about three-eighths to half a point higher than conforming rates.
The spread previously was as much as half a percentage point higher, a difference of $300 on a monthly payment, for every $100,000 borrowed (at 6%).
Start spending, now!
Source: Mortgage Matters – By Holden Lewis, Bankrate.com