Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I've been talking to several banks this week. A nice loan officer at one bank was actually apologetic about not being able to offer more competitive rates for jumbo conforming loan (more than 417k but less than 625k.) He said they were in an inbetween period since one program just ended and the new 2009 program had not started yet. He said mid-dec/Dec.15 is when the new 2009 underwriting system (by Freddie & Fannie) is being updated and that I should call back then to see what the rates are. This is to the best of my understanding because honestly, I still don't get how the mortgage world and Freddie & Fannie works...
Now, with all the other banks I've conversed with I've ran this by them and no one seems to know anything about what he is talking about. So either this nice loan officier is clueless or the others are holding out/clueless?
Has anyone heard anything similar to this from your discussions with loan officiers or brokers?
I think it's been talked about for months, but I'm unaware if there are any definite plans to change the limit...and if so - when. Increasing the limit for conforming loans would aid many people that might want to buy a house who need a loan above the current limit, and would help remove a growing number of larger houses currently on the market as well as help some high-end homes builders. If the limit was increased it would make make significant difference especially if rates for conforming loans drop to a range of 4%-4.5% that has been rumored recently.
It's actually nothing more than a software update, Desktop Underwriting 7.0 to 7.1. In Spring 2008, we started seeing some whacked pricing with the crackdown in underwriting. Fannie and Freddie called these, LLPA's or Loan Level Pricing Adjustments. These are add-ons (a quarter point here, half there) for various situations (cash out, low scores, second trust) to the consumer's price. Has anyone noticed it can take what seems like an hour for your loan officer to calculate your rate?
Right now, everyone is being penalized if they hit one of the add-ons - there are just too many variables. The net result of DU 7.1, the "better" files will net better pricing. I suspect we will be utilizing some of the risk based pricing we used before the financial crisis. We use to get "accept level 1" or "accept level II" and each of those designated approvals had an add-on that correlated to the level of risk.
For the consumer, you should see quicker pricing, lol. What was easy for me to quote one year ago as a loan officer while driving down the road, now takes a complete file and radios and distractions turned off.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
