Arizona Real Estate Notebook

“The Jumbo-Mortgage Comeback; Some Areas Are Seeing the First Signs of a Resurgence in High-End Home Loans,” WSJ.com.

• Jumbo mortgages are those that are too big to be bought by government-backed agencies such as Fannie Mae and Freddie Mac. The limits vary by region, though they generally are mortgages that exceed $417,000
• The average jumbo rate through the week ended Oct. 29 was 5.11%, down from about 6.14% on Jan. 1, 2010
• Spread between jumbo and ordinary loans, which had reached as much as 1.8 percentage points in December 2008, is now just 0.74 point
• The total volume of jumbo loans is way down from a few years ago. Jumbo mortgages constituted 5% of total mortgage originations in 2009 and 2010, versus 20% from about 2004 to 2007. Historically, they comprise about 18% of mortgages issued
• Underwriting continues to be strict: Borrowers still need excellent credit profiles and must provide complete documentation and verification of income, unlike several years ago. Down payments of 20% to 40% typically are required