Jumbo Loans: Bringing Luxury Homes Within Reach

- August 1, 2010, 4:16 pm

There has been a huge divergence between conforming and jumbo loans since 2007, the disparity become more pronounced rather than less. The trouble is, in the more expensive places where real estate is particularly expensive house buyers need a jumbo loans just to purchase a normal-size family home. According to Inside Mortgage Finance there are around 4% of purchasers with jumbo loans that exceed the ceiling set by the Home Stability Plan. This government-backed safety net removes the onus from the banks responsibility to that of Freddy Mac and Fannie Mae, providing a degree of security for homeowners who may find themselves in financial trouble. Move into the more expensive areas in and around New York and California and this percentage goes up to 8% and 17%

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