Interest rates on California jumbo loans are low. Not the lowest on record, but they are now at lows not seen since 2003. And for many people who have been “stuck” in their jumbo loan, now is the time to refinance that big loan and save on your monthly mortgage payment.
Courtsey WSJ
According to the WSJ:
Just a year ago, the average rate on a 30-year jumbo mortgage—a loan of more than $729,750 not backed by government-sponsored agencies Fannie Mae or Freddie Mac—was 6.86%, according to Greg McBride, a senior financial analyst at Bankrate.com. Now it is 5.48%—a rate that rivals those available during the height of the credit bonanza.
“In just the past couple of months, jumbo loans have really started to be competitively priced,” says Keith Gumbinger of HSH Associates, a publisher of consumer-loan information.
The recent low rates on jumbo loans has caused an uptick in refinancing activity – with some jumbo lenders reporting that jumbo refinancing up as much as 50% vs. what it was last year.
California Jumbo Loan Refinance: Big Savings?
Simple math tells you that the larger the loan balance of a jumbo loan, the more money each month can be saved when the interest rate is lowered. For bigger loan amounts, those monthly savings can easily add up to thousands of dollars A MONTH in savings. For example, a homeowner with a 30-year fixed-rate $800,000 mortgage at 6.86% pays $5,247 a month. If he were to refinance at 5%, his monthly payments would be reduced by $952.
Jumbo Lenders in California: Still Available
Many of the lenders who were loaning money on jumbo loans just a few years ago are no longer around. They have went broke, merged with another company or even gotten out of the jumbo lending market. When shopping for a lender, be sure to speak with at least a couple of lenders who specialize in helping people with their jumbo loan needs — each lender will have different guidelines and different interest rates – and by shopping for your jumbo loan, you will save thousands and get the best possible deal.
