Compare Jumbo Mortgage Rates and Lenders
Review current jumbo mortgage rates for June 19, 2018 and get personalized mortgage quotes from top lenders
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Mortgage Rates by Loan Product
Mortgage Rate ReportTuesday, June 19, 2018
Mortgage rates increased across the board this week following the Federal Reserve's widely anticipated decision to raise interest rates at its June meeting. In its statement, the Fed pointed to a robust labor market, improving household spending, sustained business investment and accelerating inflation to support a 0.250% increase in the target Fed Funds rate to 1.750% to 2.000%. The Fed's removal of more moderate language from its statement as well as bullish comments on the state of the economy by Fed Chairman Jerome Powell also increased the likelihood of two additional interest rate hikes this year and rate increases in 2018.
Although June's quarter point rate increase was all but guaranteed, there was some debate prior to the meeting over the number of rate hikes to expect for the remainder of the year, with relatively flat wage growth, moderate inflation and international trade concerns providing reasons for the Fed to pause or slow its activity. Coming out of the meeting, however, there is much more clarity regarding the Fed's plan for the second half of 2018.
While the increase in the Federal Funds rate and the Fed's more aggressive tone pushed mortgage rates higher this week, there was some positive news for borrowers. First, the Fed clearly telegraphing its intentions should provide more stability to mortgage rates in the near term. Additionally, because the market had expected the Fed's actions, the upward move in mortgage rates was relatively moderate, with most programs only increasing 0.125%, less than the quarter point increase in the Fed Funds rate.
The mortgage rate for a 30 year fixed rate loan moved 0.125% higher to 4.500% while the rate for a 15 year fixed rate mortgage increased to 3.875%. Despite inching higher, the interest rate on a 5/1 adjustable rate mortgage (ARM) remained attractive at 3.875%. FHA mortgage rates inched up 0.125% to 3.875% while VA mortgage rates bucked the overall trend and held steady at 3.875%, with both programs appealing to borrowers focused on low or no down payment programs, especially first time home buyers. Jumbo mortgage rates matched conforming loans at 4.500% and non-owner occupied mortgage rates increased 0.125% to 4.750%.
Although the Fed's move to raise rates surprised few, the mortgage market reaction to the news was better than expected, at lease in the near term. We have seen rates gradually move higher this year in response to the Fed's forecast and market predictions for future rate hikes were reinforced this week. While interest rates are impossible to predict, prospective borrowers looking to buy a home or refinance their mortgage may be able to lock in a lower rate by acting sooner rather than later. As lenders react differently to shifting market conditions, we have also seen greater variation in mortgage rates over the last month, which means borrowers benefit more by shopping multiple lenders.
Because rates fluctuate constantly, we continue to actively monitor the market for new developments. Borrowers should check the FREEandCLEAR mortgage rate tables regularly to review personalized, updated mortgage rates for lenders in their area. Our rate tables are free to use and require no personal information.
What You Should Know About Jumbo Mortgages
The Interest Rate May Be Higher.
Although not always the case, jumbo mortgage rates can be .125% to .500% higher than the interest rate for a conforming loan. This is because in the past lenders have assigned a higher risk to jumbo loans. Currently, jumbo mortgage rates tend to be the same as conforming loan rates but market fluctuations may cause differences. Interest rates for jumbo mortgages vary based on loan amount, loan-to-value (LTV) ratio, credit score and other factors.
Lenders have more discretion in determining jumbo mortgage rates and closing costs so borrowers see more variation in pricing for jumbo loans. Because interest rates and fees for jumbo mortgages can vary significantly, borrowers should shop lenders to find the mortgage with the most attractive terms. Additionally, because jumbo mortgages have larger loan amounts, even a small difference in interest rate can save you thousands of dollars in interest expense. FREEandCLEAR recommends that you always compare four-to-five mortgage quotes before selecting a lender, regardless of loan size, but shopping your mortgage business is especially important for jumbo mortgages.
Borrower Qualification Guidelines Can Vary.
Lenders also have more flexibility in setting borrower qualification guidelines for jumbo mortgages. For example, different lenders may have different credit score, debt-to-income ratio and down payment requirements. In addition to shopping for the jumbo mortgage with the lowest rates and fees be sure to understand the lender’s borrower qualification guidelines and underwriting policies.
There are Different Types of Jumbo Loans.
Technically, any mortgage amount above the conforming loan limit set by the government ($453,100 for a single unit residence in the contiguous U.S. or $679,650 for a single unit residence in Alaska or Hawaii) is considered a jumbo mortgage but the government sets higher loan limits in higher cost areas. For example, the loan limit for a single unit residence in a high cost area in the contiguous U.S. can be up to $679,650 and up to $1,019,475 in Alaska or Hawaii. Loan amounts that fall in between $453,100 (or $679,650 in Alaska or Hawaii) and the conforming loan limits for higher cost areas are called conforming jumbo, super conforming or agency jumbo mortgages and may have slightly higher interest rates than conforming loans. Loan amounts above the conforming loan limit for a county are called non-conforming jumbo mortgages or jumbo mortgages for short. The important point to note is the the interest rate and borrower qualification guidelines are typically different for jumbo mortgages.
Why Borrowers Compare Jumbo Mortgage Rates on FREEandCLEAR
Comparing jumbo mortgage rates can save you thousands. Use our rate tables to find the lender offering the lowest rates and fees
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More FREEandCLEAR Mortgage Resources
We provide a comprehensive overview of jumbo mortgages including borrower eligibility and loan-to-value (LTV) ratio requirement
Use our Conforming Mortgage Limit Calculator to determine the jumbo loan limit for your county. Mortgage amounts above the conforming loan limit are non-conforming jumbo loans
Jumbo mortgages can be more complicated than other mortgages so the FREEandCLEAR Mortgage Expert is standing by to answer your questions. So fire away and receive a helpful response within 24 hours
Use our Mortgage Selector to determine the type of mortgage that is right for you as well as how much mortgage and home you can afford