With all the turmoil on Wall Street, not only have borrowers with less then perfect credit been affected, but so have borrowers with perfect credit looking at taking out a new mortgage over the conforming loan limit of $417,000. Mortgage loans with balances over $417,000 are referred to as “jumbo” mortgages.
Many Wall Street firms that back jumbo mortgages have reduced their appetite for these loans and have increased interest rates. There are still lenders offering competitive fixed mortgage rates on jumbo loans today for around 6.5%, while many other lenders have increased their jumbo rates to approximately 7.5% or higher.
There are also lenders who are offering jumbo rates near 5.25% on 5 year Adjustable Rate Mortgages (ARM’s). These 5 year ARM’s have their interest rates fixed for the first 5 years.
It can be a great time to buy a home with mortgage interest rates this close to historic lows!
Nick Sivertsen, Summit Mortgage nick@nicksivertsen.com
