HELOC's and Jumbo Loans Surge as Vannila Loans Slump

[Ed Wood]

Here’s the mortgage and real estate deal today. Mortgage volume is down to it’s lowest levels since 2010. Wells Fargo is off by a whopping 60% and Chase is down by 54% when it comes to normal, old, conforming mortgage financing. That’s a bunch guys.

HELOCBut surprisingly HELOC's and Jumbo loans are up! In fact they're really doing well. Herb Bleacher of Black Knight Financial (Formerly LPS) said; "While first mortgages are almost half the levels as one year ago, total home equity loans have increased by 70%". This is clearly a result of the collective appreciation we've had over the past couple of years.

Jumbo Loans? There up 75% over that past year. Remember these loans don’t have to follow the new QM rules that fall in our lap this month, so some borrowers may be electing to go with a non-conforming loan rather than a traditional loan. What makes it even more interesting is that many of these non-conforming loans have better interest rates than loans guaranteed by the GSE’s.

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