Easier Access to Jumbo Mortgage Loans

jumbo loans

The average interest rate on a 30-year fixed-rate jumbo home loan was 4.30% in the week ended September 19th, according to the Weekly Mortgage Application Survey conducted by the Mortgage Bankers Association. The average interest rate on a 30-year fixed-rate conventional mortgage was 4.39%.

The jumbo loans, which are loans with balances over $417,000 and over $625,500 in housing markets with high prices, have had lower average interest rate compared to their conventional counterparts for the past year. Lenders have also relaxed the requirements for accessing jumbo loans. The credit unions have been among the most active in this respect and are gaining ever larger share in mortgage lending. Their share increased by 7% over the course of the past 10 years to reach 10% of the market, according to Inside Mortgage Finance.

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Both banks and credit unions now offer jumbo home loans with down payment which is lower than 20%. In some cases, it can be as low as 10%. Credit unions offer other extras to their members as well. Prospect borrowers can obtain a jumbo loan without mortgage insurance. Existing borrowers can take advantage of mortgage refinance even if they have loan-to-value ratio which is as high as 97%.

Traditionally, lenders have required jumbo loan applicants to have credit score of at least 700. Now many of these loans are available to borrowers with credit score as low as 650.

The range of jumbo loan products has expanded considerably as well. Credit unions, in particular, offer a diverse array of options. In addition to the 30-year and 15-year fixed-rate jumbo mortgage loans, there are adjustable rate mortgages with terms of 7, 10 and 15 years. Even interest-only mortgages are available to wealthy borrowers. Due to their small size, however, most credit unions are typically not able to provide jumbo loans of over $2 million.



Christian Calvin mortgage Christian is a contributing writer for Mortgage.info. He is a graduate from the University of Tennessee with a degree in Communications and a concentration in Broadcasting. Christian has served as vice-president for a privately-held company for more than 20 years. Additionally, he has also applied his writing and business knowledge to various websites with a focus on business and sports news . . . both of which are passions. Christian enjoys playing golf and spending time with his family and friends.

Contact: christian@mortgage.info

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