Jumbo Loans: Still Available, Tougher to Get

From Realtor Magazine Online, Daily Real Estate News February 23, 2009

Jumbo mortgages aren’t as easy to get as they were two years ago, but lenders say they are out there and available to those with the right income, credit scores and enough cash for a big down payment.

Large loans are more likely to be more available from small local banks than they are from big national ones because small banks keep the loans on their books instead of selling them.

"What we've really seen in many ways is the demise of the national lenders," says Guy Cecala, publisher of Inside Mortgage Finance.

While it can be hard to generalize, Ephraim Schwartz, a mortgage broker with O'Dette Mortgage Group, says borrowers should look at both small lenders and medium-size national ones.

Here’s what observers say is typical of what’s available:

* U.S. Bank, which operates in 24 states and is part of U.S. Bancorp, (USB) has been offering a one-year jumbo nonconforming ARM at under 4 percent for amounts up to $900,000. And he says even U.S. Bank's three- and seven-year ARMs have lately been under 6 percent.

*California Coast Credit Union and Alliant Credit Union in Chicago are both offering 30-year fixed-rate jumbo nonconforming loans starting at 6.25 percent.

Most jumbo loans require at least 20--and probably 25 percent down--and may involve paying at least one point.

Source: Investor’s Business Daily, Kathleen Doler (02/19/2009)