Why It’s Probably Not Going to Get Easier to Get a Jumbo Loan…..

by Tom on December 21, 2009
in Market Musings, banks

Jumbo loans, those over $417,000 and not guaranteed by Fannie and Freddie (aka you and me), are starting to see growing performance issues. The delinquency problems are moving up the price “food chain.”

So let me ask you, if delinquencies are rising, do you think that it’s going to be easier to get a jumbo loan any time soon?

Nah, I didn’t think so either.

Tom Vanderwell

Calculated Risk: Moody’s: Jumbo-MBS under Review for Downgrades

Moody’s Investors Service placed $143 billion of jumbo-mortgage bonds under review for downgrades … The revisions were prompted by “the rapidly deteriorating performance of jumbo pools in conjunction with macroeconomic conditions that remain under duress,” Moody’s said.

… An “overhang of impending foreclosures will impact home prices negatively,” with values likely to decline 9 percent more … U.S. unemployment will rise to peak at about 10.6 percent …

Moody’s also said it expects the U.S. government’s effort to curb foreclosures to be less effective than it previously expected because the programs have “failed to gain traction.”

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