Why are Jumbo loan rates (aka. california loan rates) sky-rocketing

[Alex_angel]

Jumbo loans or as I like to call them California home loan rates sky rocketing? With a crappy market, this is going to kill real estate in California. What gives?

[bsrsharma]

They can’t sell Jumbos to Government Sponsered Enterprises (GSEs – Federal National Mortgage Association – FNMA – Fannie Mae and Federal Home Loan and Mortgage Corporation (Freddie Mac)). With no demand in secondary market for these loan, all mortagage issuers will quickly run out of funds. Mortgage issuers act as circulating pumps converting mortgages to investment securities. Since there are no buyers for these securities (due to fear of defaults/devaluation due to home price deflation), there are no Jumbo loans.

You are just seeing almost all market for $500K and above properties go up in a flash. This is going to be a bigger deal than subprimes. Now, all homes except the multimillion $ wealthiest estates are valued @ about $500K due to the magic of mortgage availability.

[bsrsharma]

They can’t sell Jumbos to Government Sponsered Enterprises (GSEs – Federal National Mortgage Association – FNMA – Fannie Mae and Federal Home Loan and Mortgage Corporation (Freddie Mac)). With no demand in secondary market for these loan, all mortagage issuers will quickly run out of funds. Mortgage issuers act as circulating pumps converting mortgages to investment securities. Since there are no buyers for these securities (due to fear of defaults/devaluation due to home price deflation), there are no Jumbo loans.

You are just seeing almost all market for $500K and above properties go up in a flash. This is going to be a bigger deal than subprimes. Now, all homes except the multimillion $ wealthiest estates are valued @ about $500K due to the magic of mortgage availability.

[bsrsharma]

They can’t sell Jumbos to Government Sponsered Enterprises (GSEs – Federal National Mortgage Association – FNMA – Fannie Mae and Federal Home Loan and Mortgage Corporation (Freddie Mac)). With no demand in secondary market for these loan, all mortagage issuers will quickly run out of funds. Mortgage issuers act as circulating pumps converting mortgages to investment securities. Since there are no buyers for these securities (due to fear of defaults/devaluation due to home price deflation), there are no Jumbo loans.

You are just seeing almost all market for $500K and above properties go up in a flash. This is going to be a bigger deal than subprimes. Now, all homes except the multimillion $ wealthiest estates are valued @ about $500K due to the magic of mortgage availability.

[no_such_reality]

It’s simple, too many people haven’t been good for the money.

So, given the so many people aren’t good for the money, rates have to be that much higher to provide the risk adjusted return needed to buy the mortgage instead of just buying a treasury bond.

[no_such_reality]

It’s simple, too many people haven’t been good for the money.

So, given the so many people aren’t good for the money, rates have to be that much higher to provide the risk adjusted return needed to buy the mortgage instead of just buying a treasury bond.

[no_such_reality]

It’s simple, too many people haven’t been good for the money.

So, given the so many people aren’t good for the money, rates have to be that much higher to provide the risk adjusted return needed to buy the mortgage instead of just buying a treasury bond.

[bob007]

can anyone provide a link to this change in regulation ?

thanks in advance

[bob007]

can anyone provide a link to this change in regulation ?

thanks in advance

[bob007]

can anyone provide a link to this change in regulation ?

thanks in advance

[guitar187]

It is not a change in regulation.

[guitar187]

It is not a change in regulation.

[guitar187]

It is not a change in regulation.

[HLS]

It’s not a “regulation” It’s simply market conditions.

See the Forum Topic
“Help understanding the $417K limit on home loans”
off to the right.

THIS website will keep you informed.

[HLS]

It’s not a “regulation” It’s simply market conditions.

See the Forum Topic
“Help understanding the $417K limit on home loans”
off to the right.

THIS website will keep you informed.

[Author]

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