Good news for people in need of a mortgage over $417,000 and under $729,000.  When the new loan amounts came out the rates were awful and the price adjustments for cash out, FICO scores and other items were usurious.  I guess the program defeated the purpose because, I did not place one mortgage in the new program and am not really aware of anyone that did.

 

I have been getting bulletins from lenders announces the new adjustments for the Conforming Jumbo Loan programs:

       

·        Price to Conventional Conforming 30yr Base Price and add 1/2 point cost (not rate)

 

·        Rate Term Refi. >75.00% LTV: add +1.875 cost points (not rate)

 

·        Cashout Refi.: add +2.375 cost points (not rate)

 

So, if the going rate today is 6% with 0 points on a 30 year fixed for loans under 417,000, then for loan amounts over 417,000, the same rate of 6% will cost a ½ point. This is not bad! It will certainly help folks in the high end areas purchase new homes.  The cost of refinancing and/or pulling cash out are still high.  I am sure this is to deter folks from pulling more equity out of there declining in value homes. 

 

This could be a valued change in the market for consumers as well as an indication of mortgage lenders opening up to better mortgage programs.

 

Again, these fees are for 1-4 family houses and condos. This is a good day!

Dale Siegel