Jumbo Mortgages: Bigger Is Better, Again

JUMBOS are back! I thought I'd use all caps for JUMBO to sort of, you know, emphasize the bigness of the news and, frankly, to get your attention. Now, since this is a real estate/housing-oriented site, JUMBOS obviously refers to jumbo mortgages.

CitiMortgage, the mortgage finance arm of Citigroup
has announced that it is lowering its jumbo mortgage rates to 5.625 percent for a 30-year fixed rate mortgage. As recently as October 2008, jumbo rates averaged 7.95 percent.

Jumbo mortgages mean loans above $417,000 -- though that was raised on a temporary basis to $729,750 for certain higher-priced markets. And that's even though loans above the old amount still usually translate into higher interest rates and tighter lending standards.

The amounts are the limits established to get government backing or for lenders to unload (I mean sell) the loans to those darlings of the mortgage financing world, Fannie and Freddie.

But that is for their "highly credit-worthy borrowers."