Jumbo mortgages, which seemed to go the way of the buffalo once the mortgage crisis set in, are starting to make a comeback, per data parsed by the Wall Street Journal.
The publication said jumbo mortgage lenders originated $18 billion during the second quarter, up roughly 20 percent from the second quarter, using data from Inside Mortgage Finance.
That might explain all those recent OneWest Bank (formerly Indymac) billboards touting “jumbo loans without the mumbo jumbo.”
Chase Home Lending increased its jumbo loan lending by 146.2 percent in the first half of 2010, compared to last year.
Wells Fargo increased its jumbo fundings by 47.5 percent, and PHH Corp. saw jumbo loan origination volume soar 64.6 percent during the same period.
Of course, jumbo lending remains far below levels seen pre-boom and even early-crisis.
Jumbo mortgages accounted for just five percent of total mortgage originations in 2009 and so far in 2010, down from about 20 percent during 2004-2007.
Historically, jumbo loans capture about 18 percent of the market, according to Inside Mortgage Finance CEO Guy Cecala.
Jumbo loans are those that exceed the conforming loan limit, which is currently set at $417,000, though it’s temporarily as high as $729,750, thanks to fairly recent legislation changes that created so-called jumbo-conforming mortgages.
If you’re in the market for a jumbo loan, understand that underwriting guideline are still very tight, meaning full documentation is typically required, along with a hefty down payment.
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