4.25% 30 Year Fixed Rate
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30-Yr fixed 4.750 % 0.7 to 1
15-Yr fixed 3.750 % 0.7 to 1
5/1 ARM 3.125 % 0.7 to 1
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Jumbo Loan Rates as of January 2012

Jumbo home loans above the conforming limits set by the federal government are markedly higher than traditional home loans in January 2012. However, given the mortgage rates today, even jumbo loan rates are still historically lower than they have been for the last thirty to forty years.

A 30-year fixed jumbo loan as of the first week of January 2012 will fetch mortgage rates today of approximately 4.625 percent with an annual percent rate of 4.740 percent when total costs are counted for the year. The alternative of a 15-year fixed jumbo loan is far cheaper if a borrower can pay the accelerated schedule, charging only 3.375 percent with an APR of 3.569 percent.

For those who able to handle higher risk with a short-term home loan, the 5/1 adjustable rate jumbo mortgage is currently charging 2.625 percent with an APR of 2.83 percent. These kinds of loans are not fixed and reset their interest charges to a much higher index after five years have passed.

As always, borrowers are well-served by doing their research and talking to multiple lenders before committing to a particular loan application program. Jumbo loan rates fluctuate a bit as lenders compete with each other, raising and lowering rates based on demand for their particular products.

Also, borrowers need to keep in mind the advertised loan rate versus the APR amount. The advertised amount is more of an estimate. The APR on a jumbo loan is the amount the customer mathematically will actually pay when fees and interest are added to the loan principle due.

Consumers should also not be fooled by marketing statements of “No-Closing Cost Loans.” In fact, there is a cost; it is just consolidated with the loan so that the applicant doesn’t have to pay any fees out of pocket during the application process. This charge becomes obvious when one compares the promised rate with the APR or the first month’s payment is markedly higher than that of the remaining months due.

With all the above in mind, mortgage rates today for jumbo loans are still extremely attractive, particularly for those seeking financing in higher-priced residential areas. The more funding that goes towards the home, the less a home buyer has to spend on interest. If the economy improves, today’s low rates won’t likely continue for long, so those with sufficient down payment cash should strongly consider their current opportunities.