Jumbo Mortgages Are Making a Comeback
Lenders have brought back thesesuper sized loans, and for buyers who have their eye on Idaho's luxury home market, now is the time to test the water to see if you qualify for these hefty loan amounts. With the slow return of jumbo mortgages, the accompanying interest rates have dropped even lower than in the past, making it easier than ever to buy more home for your money.There are further signs that the housing market is improving all around us, including a continued growth in new construction as well as the return of jumbo mortgages, which are too large to qualify for government backing.
Jumbo mortgages usually comprise about 25% of all new mortgages, but fell to 4.3% after the housing crisis hit. For 2012, they ascended up to 11.3%.
Jumbo loans are any that rise above the conventional loan amount, which in most markets is typically about $417,000. Jumbo mortgages are a more common occurrence in markets such as New York, Chicago and Los Angeles. In Los Angeles, for example, a loan ceases to be conventional once it peaks around $729,750, and in Seattle it's $567,500.
Boise, Idaho and the surrounding Treasure Valley is home to beautiful luxury properties set in picture perfect backdrops, whether it's nestled high in Boise's foothills or along the Boise River in Eagle. With Boise's shrinking home inventory, many in the area have turned to new construction which offers an aggressive competition with the price of resale, including move-in time. With the return of jumbo mortgages, Idaho buyers looking to get into the luxury market once again have the opportunity to buy the home of their dreams, but don't expect the lending criteria to be what they once were. New ability-to-repay standards have tightened and make the process more arduous than ever before.
The biggest change in jumbo lending is the down payment. Buyers would have a difficult time trying to find a bank who'd approve a jumbo loan with anything less than 20% down. You can also expect a strict verification of income. The Consumer Financial Protection Bureau just announced tightened lending standards in the private-mortgage market. One change will ban lenders from issuing loans if they don't verify a borrower's income or assets.
For qualified buyers, the lender may throw up a hundred different roadblocks, but with today's attractive rates, it can pay to go through the hassle.