Research on the Impact of the Jumbo Mortgage Credit Crunch
Mortgage rates are at 50 year lows, thereby raising housing affordability conditions to all-time high levels. However, the historically low mortgage rates only apply to Federal Housing Administration (FHA) and GSE (the Government Sponsored Enterprises, Fannie Mae and Freddie Mac) loans, not to jumbo loans above the applicable loan limits for the geographic areas of the country. In the midst of the most significant housing downturn since the Great Depression, much less attention has been focused on the jumbo loan segment of the housing market. Both the emerging economic and housing recoveries are hindered because of credit market difficulties in the jumbo mortgage market.
