5 hot year-end home mortgage trends

Low jumbos attract few takers
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Luxurious house

In the last few months, rates on jumbo mortgages (home loans for more than $729,750) have been falling faster than rates on other mortgages. Now, rates on jumbos are downright attractive.

That's quite a turnaround. Jumbo rates skyrocketed in the summer of 2007 amid the mortgage meltdown and remained high for a long time. A year ago, the benchmark jumbo was 1.2 percentage points higher than the conforming 30-year fixed. Lately, it's been less than three-quarters of a percentage point higher.

Rates are low, but relatively few people are refinancing their jumbo loans because underwriting is strict, Anastos says.

"Some of the refinancing on a jumbo loan takes so much longer than on a conforming loan," he says.

Jumbos are not guaranteed by Fannie Mae or Freddie Mac. Consequently, jumbo rates are higher because they pose more risk to the lender.




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