Landscaping

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Good morning, again. The L.A.Times’ E. Scott Reckard checks in on the jumbo market and reports that it is still messy and pricey: ‘creditworthy borrowers are getting hammered if they want mortgages with payment options or ‘jumbo’ loans...’

How bad is it? Reckard tells of a Manhattan Beach landlord (near perfect credit) trying to refinance a home that’s worth in the $1.6 million range (he thinks), and currently carries a $650,000 mortgage. He’s looking for a 30-year fixed with an interest-only pay option for the first 10 years. Last year he got a similar mortgage on another property with a 5.5% rate.

So what did WAMU quote him?

(Wait for it... Wait for it...)

‘A loan officer at Washington Mutual Inc. quoted him a rate of 9.75%, saying that the lender ‘had to charge such high rates so that they could sell off the loans’’ ... He passed.

Doug Duncan of the Mortgage Bankers Assn.: ‘No one’s buying mortgage-backed securities that are backed by jumbo loans.’

Thoughts? Comments? Any recent stories from the real world?