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Jumbo Mortgages: What Your Clients Need to Know

Amy Green, Coastal Premier Properties

When you think of jumbo mortgages you might think of expensive homes, but in many markets throughout the country prices are high enough that jumbos are needed just to buy a home that’s not much more than the median home price or, in some cases, even at the median price. With prices now heading up again on a national basis, jumbos will become more important for home buyers.

Jumbos today start at $625,500 for Fannie Mae and Freddie Mac loans, and $729,750 for FHA loans.

With these trends in mind, REALTOR® Magazine hosted a webinar on August 7 with PNC Mortgage to look at what lenders are looking for from loan applicants and how their agents can help their clients be in the best position when they apply for financing.

It’s a big topic, but some of the things we sought answers to were these:

  • What’s the pricing in the market today?
  • What’s driving rates on the product?
  • What factors do lenders look at when processing loan applications?
  • Who is a typical type of client in the market?
  • What makes the jumbo process different from conventional loans?
  • What type of documentation can a client expect to provide to a lender?
  • what do agents need to be mindful of given the added complexity of jumbo loan processing?
  • What are pre-approval issues to be aware of?

To look into these and other questions, we talked with Amy Green, owner of Coastal Premier Properties, and Bill Reiter, a loan officer at PNC Mortgage. They’re both in San Diego but what they have to say is applicable to the jumbo sector throughout the country, because they talk about best practices that go beyond locality. And they frequently work on transactions together, so they talk a lot about how to make the agent-lender relationship work.

We also heard from Arnold Simon, a PNC Mortgage executive, who provides his take on the market from his vantage point. NAR Director of Regional Economics Ken Fears is on hand, too, for an update on home sales in the jumbo price range.

Without a doubt, the challenges your clients face getting financing is the issue for today. Buyer demand is not the issue. NAR Chief Economist Lawrence Yun says the demand is there; what’s holding sales back today is the friction in the mortgage market—both the conventional and the jumbo markets. Our goal with this webinar was to find out what you can do to help your clients get the financing they need to buy the house they want.

Access it now.

Robert Freedman

Robert Freedman is manager of multimedia communications for the NATIONAL ASSOCIATION OF REALTORS®. He can be reached at rfreedman@realtors.org.

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Comments
  1. Jess

    It should be clarified that jumbo loans don’t “start” at $625,500 as every state as a limit based on the mediain income. For example Oregon’s jumbo starting point is $417,000.

  2. Rich from CA

    Correction:
    What Fannie Mae and Freddie Mac call a regular loan that is not a jumbo is “Conforming”. Conforming loans are all loans under $417k across the USA. Also FNMA and FDMC loans do not “start” at $625k they STOP at this amount. So FNMA and FDMC will do “Jumbo” loans over $417k and up to $625k but it does depend on the county for Jumbo loans.
    FHA will do jumbo loans up to a max of $729k but it is based on the county. You can seach FHA websites for loan limits by your county. FHA’s website will also give you loan limits for FNMA and FDMC as well.

  3. jumbo loans also start at $417 in wisconsin……

  4. correction……$417,000…….

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