If you have been postponing a purchase, sale or refi because the loan amount you need is too big for Fannie, Freddie or FHA, check out the new, non-Wall Street sources of jumbo mortgages. Major banks, like Bank of America, are originating big loans at affordable rates to keep in their own investment portfolio.
With the collapse of the private mortgage bond market on Wall Street, home buyers, builders and refinancers who relied on jumbo financing were left with high interest rates and huge down payments.
The country’s largest mortage lender, Bank of America, is rolling out a large program to finance loans between about $730,000 and $1.5 million, with fixed 30-year rates starting in the upper 5% range. “The loans will be available through the bank’s retail network and through its Countrywide Home Loans subsidiary. After April 27, Countrywide will be re-branded–shedding the name it’s had since 1969–and morph into Bank of America Home Loans”. “The new program requires hefty liquid resources–six months of principal,interest,property tax and insurance payments in reserve-plus fully documented income, solid credit scores and a full appraisal”.
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