[quote=Rich Toscano]Right, nobody can argue that it’s a positive, but is it a significant negative?
sdr says no, that it’s the same to qualify for both types of loans. But for instance sdr, I’ve heard that down payment requirements are higher for non-conforming loans… if this is true, (even if “qualifying” is otherwise the same), that represents a tightening of financing for this price range. Any idea whether that’s the case?[/quote]
I’m not sdr, but I believe many buyers seeking jumbo products to buy in “upscale areas” have the resources to put down far more than 20-30% but choose not to because they are able to leverage their purchase without the extra mortgaged amount costing them more in the form of a higher interest rate.
Obviously, if they are paying a 1% origination fee or “points,” then this “closing cost” would be a little higher. However, the purchase money points are tax deductible. If I was in this category, I wouldn’t pay points. I would take the rate offered without points. But that is just me.
Also, I believe many of these buyers are nearing retirement and have plans to retire their *new* mortgages within ten years.
edit: I guess what I’m trying to say here is, I don’t think any “tightening” to qualify this category of already highly qualified buyers (who purchase in places like Monterey) is going to make much of a difference in prices. “Location, location, location” will always prevail as the holy grail of value in CA, even if that mantra is referring to a vacant lot :=]
