A large jump in jumbo mortgage rates created a excessive increase in homes for sale at the higher price ranges in 2007 through 2009. However in 2010 higher end home sales have picked up due to better mortgage rates.

 “The inability of homeowners to refinance their jumbo loans is holding back potential consumer spending for the overall economy,” said NAR Chief Economist Lawrence Yun. “If they had the opportunity to refinance into historically lower mortgage rates, many current jumbo mortgage holders could save $6,000 to $15,000 in annual interest costs.”

We are into the Spring market of 2010 now and jumbo loan rates seem to be more available and affordable.  Since the beginning of 2010, banks including Wells Fargo, Bank of America and U.S. Bank have gotten more aggressive in originating jumbos, said A.W. Pickel, president of LeaderOne Financial, a mortgage lender in Overland Park, Kansas. "If you underwrite carefully and cautiously, a jumbo loan is a very good money maker for a bank," he said. He went on to say; “In time, a working private securitization market for mortgages could eventually affect the entire mortgage market.”

"It's a very small step. A miniscule step," Gumbinger said. But if it works, and a private securitization market develops, this could be one of the earliest signs of a return to a normalized jumbo mortgage market."

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