When hearing the term "jumbo loan rates" you may find yourself wondering just what type of loan that is and who actually gets them. Which exactly is jumbo, the rates or the loan and who in their right mind would want either.
Jumbo mortgages are mortgages that are for bigger than normal loan amounts. They are also known as California loans because of their prevalent use in California to purchase the expensive homes that are located there. You could say the jumbo loan concept was likely born in California before the housing bubble created expensive real estate across the country.
Conventional conforming loans in the $417,000 (or $625,500 in Alaska and Hawaii) as set by Fannie Mae and Freddie Mac are typical loans and jumbo loans are those loans considered above this amount. However, the recent economic stimulus package temporarily increases the conforming limit to $729,750 until December 31, 2008.
Jumbo mortgages, usually associated with very high priced homes, also carry rather high jumbo loan rates as well. These rates can differ only due to the amount borrowed to purchase the home as and such the rates are higher and fairly hard to get. A mortgage interest calculator can help you determine the total cost of these type of loans.
Good credit, higher income brackets and great assets will give you the best chance at getting one of these loans. These are usually people who have owned homes before, and are considered good credit risks.
Just as loans can differ among the more conventional market buyers jumbo loans can be variable as well. Hybrids, adjustable and fixed rate loan are available in this type of market as well and loan to value ratio's can be as high as 0. Terms of these loans can vary quite a bit as well depending on the type you get.
Loan rates have declined considerably over the years so will you get stuck with a jumbo size interest rate on that jumbo loan. Rates have declined but most likely the answer is still going to be yes. Using a mortgage interest calculator can give you the answer quickly
Jumbo loan rates can typically run anywhere in the range of .125% to .75% and sometime higher depending on the terms of the loan. Although higher in term of interest paid, those who purchase a jumbo loan can typically absorb that cost. Most prefer putting down a larger down payment when getting their home loans which saves them a great deal of money.
If you are considering jumbo loan rates your best bet is to get online and use a free mortgage interest calculator which can tell you instantly what these types of loans will cost.
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