Jimbo's Jumbo
My friend Jimbo has been looking for a new home since November. Poor timing, because Jimbo needs a jumbo. He requires a large home and therefore a large mortgage. (A jumbo mortgage is any loan that exceeds the conforming loan limit of $417,000.)
Before the housing crises, jumbos, the high end of non-conforming loans, were much easier to acquire as lenders used stated income and didn't require backup documentation like pay stubs or tax returns. That all changed around the same time that many of us learned what a credit default swap actually is. As it turned out, not only was the sub-prime market a scary place for investors, so was the luxury market.
But lenders seem to be loosening up a bit. Interest rates for jumbos have inched their way below 6% as of late, so Jimbo may be in luck. He'll have to provide documentation of his income - the days of stated income will at best bookend the period we're in now - but he'll at least have a shot at a reasonable interest rate.
Before the housing crises, jumbos, the high end of non-conforming loans, were much easier to acquire as lenders used stated income and didn't require backup documentation like pay stubs or tax returns. That all changed around the same time that many of us learned what a credit default swap actually is. As it turned out, not only was the sub-prime market a scary place for investors, so was the luxury market.
But lenders seem to be loosening up a bit. Interest rates for jumbos have inched their way below 6% as of late, so Jimbo may be in luck. He'll have to provide documentation of his income - the days of stated income will at best bookend the period we're in now - but he'll at least have a shot at a reasonable interest rate.
posted by Ian Huckabee at 11:31 AM
