Keller Williams Realty of Northern Colorado

While interest rates for conventional loans reached historic lows in recent years, it has been a different story for jumbo loans. Interest rates for jumbo loans shot up as lenders tightened restrictions and steered clear of anything that could be considered somewhat risky. Another factor working against jumbo loans – they are too large for the government to support through the Federal Housing Administration, Fannie Mae, or Freddie Mac.

Understanding Jumbo Loans
First, what constitutes a jumbo loan? Below is a chart that breaks down what it means to be a Conforming Loan, Conforming Jumbo and True Jumbo Loan:

* $729,750 is the upper limit in the most expensive areas.
Limits vary depending on median home prices in local areas.

Recent Changes in Jumbo Loan Interest Rates and Down Payments
The difference between interest rates on conventional loans and jumbo loans has decreased from higher levels seen last year:

* Based on the week of February 25, 2010.

In some cases, the down payment requirements are easing as well, but they often still depend on the level of borrowing – the more the mortgage, the higher the down payment percentage. In New York, mortgage professionals report the following common down payments:

**According to Bank of America’s Jeffrey Appel in Inman News.

Borrowers will still need a good credit score, typically at least 700, evidence of high income, and a sizable bank account.

In Summary
Available credit for the high end will likely help stabilize prices in that sector and boost the overall average sales price. Until now, the high levels of activity in the entry-level price points combined with relatively few sales at the high end have skewed the average price down.

Thanks for reading our Fort Collins Real Estate Blog!
Posted By: Keller Williams Realty of Northern Colorado – Fort Collins CO Realtor,
specializing in Fort Collins CO Real Estate and Northern Colorado Real Estate
Pictures of Fort Collins

970.377.3700