Non-Conforming In Coconut Grove
October 24th, 2008 | categories: Coconut Grove Real Estate
This post is authored by our Guest Contributor
James Venney
As a kid in the early 1970’s growing up in Coconut Grove was a lesson in cultural diversity to say the least. On Main Highway while riding in air conditioned comfort of my fathers Cadillac with the rustle of my freshly pressed pinpoint oxford cramping my 5 year old style I would look out the window and ask…”who are those men with the long hair” to which my father would reply…”they are hippies, non-conformists”. The term non-conformist was way too much for my 5 year old mind to grasp but I did realize that they were “different”.
Similarly, non-conforming mortgages are those that do not conform to the loan purchase guidelines set forth by Fannie Mae or Freddie Mac. Jumbo mortgages (those over $417,000) are non-conforming and are therefore considered “different”.
The most recent spasms in the credit market’s have caused the interest rates on non-conforming mortgages to climb as there is very little investor appetite for mortgage backed securities that contain jumbo mortgages, which is odd because the fact is that the default rates on jumbo mortgages is significantly lower that that of conforming mortgages.
Like the Grove hippies of the 1970’s non-conforming mortgages are being unjustly punished for being “different”. Rest assured that as the credit markets thaw non-confiorming mortgage rates will fall and we will all live in harmony once again.
Authored by: James Venney CMPS, CMA
Phone: (305) 960-2671
Email: [email protected]
James Venney is a licensed mortgage broker and a State Certified Residential Appraiser. Currently, he is the top producing mortgage banker at Home Services Lending which is a joint venture with Warren Buffet’s Berkshire Hathaway and Wells Fargo Bank.
You are a very smart person!