Jumbo mortgages today have a lower interest rate than conventional mortgages. For those who don't know a jumbo mortgage in most markets is a loan that is over $417,000. And because they typically aren't as liquid as conventional mortgages the rate on a jumbo mortgage is higher than a Fannie Mae loan.
But for the first time you can obtain a jumbo mortgage for a lesser interest rate. Why is this? Mortgage rates have been steadily increasing for the last couple of months due to various factors in the economy. Jumbo mortgages are usually set a rate that a private investor or bank is willing to offer based upon quality and portfolio needs.
Today due to the numerous changes in the secondary market Jumbo mortgages are a higher quality investment because borrowers tend to have higher credit scores and larger down payments. This makes this type of loan more attractive as a safer investment for a bank's portfolio and they can now offer such at a lower rate.
This is a very unusual anomaly in today's mortgage market and one that can be taken advantage of as rates may continue to climb as the economy improves.
Any questions or comments please feel free to call Tom Turner at First Choice Mortgage Services at 203-257-9083 or tmtiii@msn.com.
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