Recently I received a few inquiries about the financing and refinancing of SUPER JUMBO residential properties. Given the markets current preference for financing that can easily be purchased by the GSEs (governments sponsored entities) like Fannie Mae and Freddie Mac, most owners of homes with loan balances in excess of $417,000 for conforming properties and $729,750 for jumbo conforming properties feel left out. They need not feel this way much longer.
For many lenders, the chill that had fallen over non-GSE “agency” products is now starting to thaw. The loan to value ratios are still conservative (45 – 70% max), but given that most people who use non-agency monies normally have a certain net worth and liquidity, this is not a problem. There are now programs that will go up to $2,000,000 at 60% loan to value on the purchase and/or rate and term refinance of a home. The credit score requirements are higher now (720+) and so are the reserve requirements (averaging 12 months payments and many times 12 months income on top of that), but the possibilities are there.
So if you or a client has felt limited in your (their) purchasing capabilities, you can now raise the bar. Capital is once again slowly becoming more available for the large transactions that need to get done and want to get done. All one needs to do is ask an experienced mortgage professional about their options.