Question by Kavan Lee: What does the Fed’s three-quarter point cut today mean for mortgage refinances?
I got a jumbo loan in October 2007 at 6.125% (I’m in the SF Bay Area). Since the Fed rate has been cute by 2 points since then, and I understand that as of June my loan will become a conforming loan, what kind of refinancing rate could I reasonably expect to obtain this summer? By “reasonable,” I mean nothing shady, just run of the mill Bank of America or Wells Fargo type solid deals.
Answer by J O
Honestly there is no way to know. I manage at the national headquarters of Midwest’s largest privately held mortgage bank and we have no idea what is going to happen with rates. While you are correct that you will soon have a conforming loan, we are anticipating a tiered rate structure amongst the major end investors. I would not be surprised to see a new subset of rates that falls between conforming and jumbo. 6.125% is not a horrible rate in this market for a fixed, jumbo product.
If you have further questions feel free to email me, unlike most people who answer questions on here I actually know what I’m talking about and have the credentials to back it up.
Edit: I just recieved this email from an answerer that I will not name
“unlike most people who answer questions on here I actually know what I’m talking about and have the credentials to back it up.”
Granted there are a bunch of idiots and kids but pardon me for stepping on your holy feet YOU ain’t the only one with credentials that far out weight yours.
It’s ok to disagree with me, but if you are going to do so please at least use proper english! Ain’t and out weight…HA!
Know better? Leave your own answer in the comments!