Jumbo Loan Options Expanding

Millions of Americans have started to receive their rebate checks from the government in the mail over the past few weeks. This part of the economic stimulus package has received the most attention in the news, however there is another key benefit of the program that has also begun to trickle through. The legislation has also allowed for home owners hwo have jumbo loans to refinance these loans under conventional financing terms.

This new alternative should be welcome news to  anyone who has a mortgage that is over 417k. The spread between conventional loan rates and jumbo loan rates has been in excess of two percent form the better part of the past six months. The secondary market for jumbo loan financing has all but disappeared and the result has been a dramatic increase with the mortgage rates on jumbo loans. Lenders such as CitMortgage, Countrwide and IndyMac are now able to qualify home owners in select counties for loan sizes up to $729,000 and have their loans underwritten and sold to either Fannie Mae of Freddie Mac. This is welcome news for anyone owning a home above $450,000 as this should help to bring some home buyers into this marketplace and provide realistic refinance options for home owners who may have chosen an adjustible rate mortgage a few years back.