Are Jumbo Loans Making a Comeback?

The underwriting is still tighter on jumbo loans than conventional or FHA financing, but lenders and investors are increasing their appetite for solid borrowers that are willing and able to fully document their income and assets.

Jumbo Loan Interest Rates are currently very attractive and I have seen an increase in traffic for both refinances and purchases. Some clients are able to afford the neighborhood previously unattainable.

To get an idea of the appetite increasing for Jumbo Loan Rates, I thought I would share rates as of Friday 1/27/2012 for active clients:

• Illinois Refinance, Loan Amount of $690,000 7/1 Jumbo Libor ARM Rate 2.875%/2.899APR (801fico) 80% LTV
• Kiawah Island South Carolina, Loan Amount of $810,000 30 Year Jumbo Fixed Rate 4.50%/4.524%APR (775Fico) 66% LTV
• Illinois Purchase, Loan Amount of $950,000, 15 Year Jumbo Fixed Rate 3.75%/3.784APR (765 Fico) 25% Downpayment
• Philadelphia, PA, Loan Amount of $1.5M, 30 Year Jumbo Fixed Rate 4.625%/4.649APR (770 Fico) 20% Downpayment

Other Niche Jumbo Product Offerings Include:

• 90% One Loan Purchase Mortgage with No Mortgage Insurance (10% Down Jumbo)
• Additional rate improvement for Fico Scores 800 or higher
• Common sense underwriting for High Net Worth Borrowers
• Portfolio Products for Loan Amounts exceeding $2m

Of course, every situation is unique, but in general these rates particularly the 7/1 Jumbo ARM are extremely attractive. When the market first imploded in 2007, jumbo mortgages skyrocketed. We are now seeing an increased appetite for solid borrowers, larger loan amounts, that can document their income, employment and assets.

I think it's safe to say that Jumbo Loans are making a comeback!

Chris Jones

Prospect Mortgage, LLC

NMLS 130813

312-577-5205 D

312-505-9949 M