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Clock is ticking for jumbo mortgages....

Print Posted by Cheryl Costa July 27, 2011 10:09 AM

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When the housing market was looking especially bleak, the federal government supported jumbo loans as large as $729,750 in some regions of the country. However, that will change in October when the largest mortgage that the government will buy from lenders will drop to $625,500. Once this happens, rates on mortgages above this limit will likely rise substantially and additional documentation will likely be necessary because lenders will have to keep these loans in house. Furthermore, people looking to get these larger loans will need to have higher credit scores and will need to have downpayments of at least 20 to 30 percent.

If you think you will be in the market for these jumbo loans, you will need to act quickly because although the deadline is October, lenders will likely stop offering this sized jumbo loan by the end of this month to allow time for the mortgages to close.

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Local finance professionals share insights and advice on issues such as budgeting, managing debt, and retirement planning.

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About the contributors

Andrew Chan is the founder of Integrative Financial Advisors in Framingham. He provides comprehensive financial planning advice and investment management services. He has been an adviser for over 12 years and works with clients to integrate all aspects of their finances including investments, retirement, education funding, and tax planning.

Cheryl Costa is a principal at Forteris Wealth Management which is an independent, fee-only firm with offices in Framingham and Purchase, NY. She advises clients on investing, education funding, taxes and retirement planning. She has a BS from Worcester Polytechnic Institute and an MBA from Boston University and she is a Certified Financial Planner.

Jamie Downey has been an accountant for more than 14 years. He's a partner at Downey & Co. in Braintree. Prior to joining the firm, he served as a manager in the audit department of accounting firm KPMG.