Daily Real Estate News April 4, 2008
Banks Up Rates for FHA Jumbo Loans
Banks are adding fees and increasing interest rates on Federal Housing Administration loans that make the government-guaranteed mortgages less likely to assist their target customers.Congress recently approved an increase in the ceiling on loans the FHA can insure to as much as $729,750 in the highest-cost areas, up from $362,790.J.P. Morgan Chase & Co. is only one of the lenders saying it will charge at least a half-point premium and demand a minimum 580 credit score from borrowers seeking the FHA jumbos.
Kevin W. Lynch, a mortgage broker at A. Anderson Scott Mortgage Group in Rockville, Md., says he has been quoted rates of nearly 7 percent on jumbo FHA loans. The loans are so expensive they "aren't going to sell," Lynch says. "It's a waste of everybody's time."Source: The Wall Street Journal, James R. Hagerty (04/04/08
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