Jumbo Mortgage

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Jumbo Mortgage

A mortgage loan so large that it exceeds the limits for securitization by U.S. government mortgage banks. A jumbo mortgage cannot be guaranteed or securitized by Freddie Mac or Fannie Mae. Because of this, jumbo mortgages carry higher credit risk and have historically been traded at a premium to conventional mortgages.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

jumbo mortgage

A loan in an amount greater than the size limits for Fannie Mae or Freddie Mac purchase.The loans must remain in the lender's portfolio or be sold to other investors.Because the loans cannot be sold easily,some banks charge a higher interest rate for them.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.

Jumbo Mortgage

A mortgage larger than the maximum eligible for purchase by the two federal agencies, Fannie Mae and Freddie Mac.

The maximum was $322,700 in 2003. However, some lenders use the term to refer to programs for even larger loans, such as greater than $500,000.

The Mortgage Encyclopedia. Copyright © 2004 by Jack Guttentag. Used with permission of The McGraw-Hill Companies, Inc.
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Strong loan originations in our C&I, commercial real estate and multifamily businesses were partially offset by elevated payoffs in our lender finance book and subpar loan production in our single family jumbo mortgage group.
DiCenso is responsible for expanding the company's private banking through jumbo mortgage lending; Cowan will work in new business development and relationship management
Two credit unions currently offering jumbo mortgage loans said they will still provide them, despite large banks in their markets beginning to aggressively price similar offerings.
"On top of that, loan limits have been lowered, which means buyers of higher priced homes, including many in more expensive housing markets, now have to pay a higher interest rate for a jumbo mortgage than buyers who can qualify for a conventional loan.
As historically low mortgage interest rates have been recently seen in the low to middle priced housing market, the jumbo mortgage is also making a come back.
The Board also proposed new mortgage lending rules dealing with enhanced consumer protections, disclosures, and revisions to the escrow rules for jumbo mortgage loans.
Jumbo mortgage loans pose a higher risk for lenders, and this risk is consistently reflected in the spread between the interest rates on jumbo mortgages and conventional mortgages, where the historical average is about 30 basis points.
"The jumbo mortgage business here in New Hampshire is really no big deal, it's just not an issue," said Francese, director of demographic forecasting for the New England Economic Partnership and a consultant to the New Hampshire Association of Realtors.
"If I was to give advice of one sensible and one extravagant thing to do then I would say practically if you have a jumbo mortgage, you should reduce your load.
The proportion of mortgages originated and held by or purchased by commercial banks and savings associations rises to 40 percent, reflecting the relatively large presence of these institutions in the jumbo mortgage market.
Private banks and commercial institutions alike will move mountains to customize a product such as a jumbo mortgage to meet your needs.
He says independent mortgage banks tend to be more flexible on things like credit standards, especially for FHA loans, whereas big banks are more flexible on jumbo mortgage credit terms.