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February 21, 2008
seeking advice on securing jumbo financing
We are about to enter into contract on a brownstone in BK and will need to secure financing. The purchase price is ~$1M and we will be putting 20% down. So we are left with a few options to get to either a 30 year fixed or a 7/1 ARM - either one shot jumbo with very high rates, or splitting it into two pieces. Does anyone have any suggestions on creative ways to get our all-in APR down, or on Jumbo lenders that do not securitize and thus have lower rates than the big lenders are offering right now?
Comments
The amount of a mrtgage that is classified as jumbo has changed or will very soon for all lenders. It is no longer that $360,000 or $380,000 level. Check around
Posted by: daveinbedstuy at February 21, 2008 8:18 AM
actaully a jumbo is currently $417K. The rules have changed per the congressional "Stimulus Package" signed into law last week.
Th Jumbo Limits are now $729,750, but it is going to take at least a month or so for lenders to adapt to the change, so it may not help you for now.
Posted by: guest at February 21, 2008 8:48 AM
We're first time buyers also and just finalized our mortgage. We put down 10%, financed the first 80% with an interest only mortgage and financed the remaining 20% with a home equity line of credit.
It's true that the jumbo loan amounts are now changing in our favor, but this will not affect the rates for a few months. We have already spoken to our lenders and they will let us refinance in a few months once it all happens.
Posted by: velvetflip at February 21, 2008 11:47 AM
it's worth talking to a mortgage broker re: locking in a jumbo mortgage rate and seeing if the change has trickled down by the time you close...sometimes, it takes forever!
Posted by: guest at February 21, 2008 1:15 PM
It is crazy to do an ARM right now - with new concerns about inflation, bankers are predicting interest rates will have to rise significantly much sooner than expected - even if there is another rate cut first. You should WAIT until the jumbo rates that can be secured by Fannie Mae increase to $729,750 and then get a fixed rate for that amount and a heloc for the rest. Silly probably to get a mortgage before the new law goes into action. You should DEFINITELY be talking to a mortgage broker right now - I reccomend Frank Gooden - he's on top of his shit and a super nice guy - and knows the brooklyn market well. His number is 718-230-3400. REmember it doesn't cost you anything to go through a mortgage broker.
Posted by: guest at February 21, 2008 1:20 PM
biweekly fixed jumbo with ridgewood savings bank- 6.3 rate.
Posted by: guest at February 21, 2008 2:28 PM
I recommend breaking up the total into two fixed notes. I recently did the same and the blended rate was much lowere than my former interest only rate and HELOC combination. I went through a woman named Rolli Singh at Wachovia on Park Avenue. She was great throughout the process, was able to find me the best rates, and made great recommendations on ways to reach my desired 30-yr fixed note with a low rate. Her number is 917-332-3620. Tell her Chris Montgomery referred you.
Posted by: guest at February 21, 2008 3:48 PM
Whoever recommended Ridgewood is on the right track. Look at local thrifts that take in deposits and make loans. Don't know if they do jumbos, but Cross County is another small thrift that had great rates for mortgages when I was looking. Chances are the lending standards will be high, but if you can meet them, you will get a better deal. Don't know if there are mortgage brokers who specialize in this kind of loan. Brokers I have talked to all worked with bigger banks.
Posted by: guest at February 21, 2008 6:06 PM
BTW, some other thrifts to check out, that had good rates on the ARMs (you can refi when the new jumbo rules take effect), and Fixeds when I was looking:
Astoria Federal Savings, Queens County Federal/Roslyn Savings.
Posted by: guest at February 21, 2008 6:12 PM
Thanks very much for all of the helpful replies. As an FYI to anyone interested, the conforming limit on a 2 family is actually $533k. And local thrifts that take in deposits and hold loans on their balance sheets is definitely the best bet if you want a 30 year fixed jumbo...
Posted by: firsttimebrownstoner at February 21, 2008 10:22 PM
Not so fast Brownstoners...
Jumbo mortgage rates not seeing much relief - Congress' plan to help the jumbo-loan market -- passed two weeks ago as part of the Economic Stimulus Act -- still is a work in progress. Key details of the plan were left to the Department of Housing and Urban Development to nail down, which may take until next month. What's more, the securities industry's biggest trade group last week surprised lenders when it recommended that larger loans be in effect isolated from smaller mortgages in the "secondary" market, where loans are packaged into securities for sale to investors. That could keep interest rates on jumbo loans higher than some borrowers had hoped, analysts say. LA Times 2/22/2008
Posted by: moreteasir at February 22, 2008 11:02 AM
Citi (which has generally pretty high rates)- will give 5.875 on a jumbo with FICO above 700 (or 720? I forget). I think that's pretty good. As for conforming limits- that won't change for a while. The GSE's have to first change policies- then that goes out to lenders- and then the lenders change underwriting. Its up to you, but I think 7/1 is pretty safe. Lots of people got in trouble with 2/28 or 3/27 but seven years is a long time so if you have a good rate- you can lock in seven years and then during that time- try to refi with a fixed (although new closing costs would suck).
You never mentioned with APR you were offered. Also- no one is securitizing now.
Posted by: panda10 at February 22, 2008 2:00 PM
Citi is offering 5.875 on a jumbo?? Yeah, maybe with 10 or 12 points. That is completely unrealistic... especially since conforming rates are in the mid 6's at the moment.
Posted by: guest at February 25, 2008 10:48 AM
Your rate will be much higher on your second so I would not advise that. You should take a 5 year arm @ 5.125%. I do a lot of business with Ridgewood as well. When the new conforming limits come out there will still be adjustments. Email me your work number and I will take care of you on Mon. If the guidelines change we can switch you to a fixed. jayrhee@gmail.com
p.s. Some mortgage brokers here pretend to be clients but if you want Brooklyn references I have many people who can vouch for me...
And my underwriter showed me that Citi is discounting I think ARMS now but that is for existing pipeline only...
Posted by: guest at March 2, 2008 12:22 AM
Rates should go down on Mon but the way the market is you never know. You can lock and if the rates go down and that bank won't allow a floatdown I'll switch it to another...
Posted by: guest at March 2, 2008 12:28 AM
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