Bankrate.com: Last week’s average for a 30-year fixed jumbo mortgage was 4.48% vs 4.95% for a conventional loan. Today, $1M is price of entry in some markets.
NEW YORK – Affluent home buyers are less affected by skyrocketing U.S. mortgage rates, with Bankrate.com estimating that the average for a 30-year fixed jumbo mortgage reached 4.48% last week, versus 4.95% for a conventional loan.
In the early days of the pandemic, jumbo rates were about half a percentage point higher than costs for smaller mortgages. Jumbo loans exceed the conforming limit of $647,200 in most areas and top $970,800 in expensive markets like San Francisco and New York City.
Jumbo mortgages differ from conventional loans by being less susceptible to the peaks and valleys of the secondary market because lenders usually keep them on their books and use them to draw wealthy customers and sell them on other services.
Big mortgages are gaining in importance, especially in expensive regions where $1 million is typically the price of entry.
“If there’s a silver lining for home buyers that find themselves taking bigger loans as home prices have soared, it’s that jumbo mortgage rates are actually lower,” said Bankrate.com chief financial analyst Greg McBride. “It’s another indication of the uniqueness of this mortgage market.”
Source: Bloomberg (04/12/22) Gopal, Prashant
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