La Quinta, California

La Quinta, California
Desert Luxury

Desert Luxury Realty

Thank you for visiting my blog. When you choose Mary Williams, as your real estate agent, you are working with a team of seasoned professionals who cater to your every real estate need. Buying or Selling your home does not need to be full of hassels or needless pressure. Take it easy and enjoy the luxury of the desert. I look forward to assisting you with your search or sell of your home. Contact me today!

Tuesday, April 23, 2013

Jumbo Loans May Mean Super-Sized Requirements in the Desert

Jumbo loan elephant - from microsoft clipart

With jumbo loans making a come-back into the Desert area mortgage market, many a luxury buyers (and sellers) are rejoicing!

But before you dash out and get a loan, you may want to know; Jumbo loans are coming with jumbo buyer requirements.

Specifically – buyers across the luxury home market that are considering a jumbo loan should be aware that large cash reserves are often required for purchases over $417,000.

Some lenders require their borrowers to have a reserve of up to 12 months’ worth of mortgage payments in the bank or liquid assets for purchases from $417,000 to $2 million according to a recent article from the Wall Street Journal Online. For loans over $4 million the figure is more like 36 months’ worth of reserves.

Cash reserves aren’t the only thing super-sized. Down payments are larger on a jumbo loan too. Most lenders require at least a 20% down payment for jumbo loans with some going as high as 45%.

If you don’t quite meet some of those criteria exceptions can sometimes be made. This is especially true if you call on a lender that you’ve done a great deal of business with. Items like reserve amounts can sometimes be tweaked with the right relationship or for a buyer who is strong in other respects such as credit or down payment.

Why the big costs? Jumbo loans represent a larger investment and a larger risk to the lender. Many of these homes are customized, making them appealing to a smaller pool of specific buyers so if the loan goes belly-up the home will be more difficult than average for the lender to unload.

The bottom line: Jumbo loans may require more money in reserve and upfront, but if you’re a strong buyer the luxury market can yield a pretty amazing home!

Whether you’re looking for a luxury vacation, a second home in the Desert, or even miles away from us, I can assist you with your purchase in La Quinta and surrounding areas. Call 760-567-7282.