Remember when Bond prices move higher, home loan rates move lower…and vice versa. Despite some declines in the early part of the week, Bonds were able to rally back last week .

Below are some interesting loan products offered by some of the mortgage professionals I work with. If some of these terms seem like Greek to you, here is a brief glossary to get you started:

Full Doc, Limited Doc, Stated Income – Full Doc means full documentation. In the past, self-employed people like me could go with ‘limited doc’ and ’stated income’ and not have to produce reams of paper that proved I earned enough money to pay the loan.  Generally, the only people who can qualify on full doc have real jobs with pay stubs and 1040’s.

Ratio– this is the percentage of income that goes to your loan. Banks study ratios carefully to make sure you’re not stretched too thin.

Conforming and Non-Conforming– Conforming loans have been covered in this blog before. It has to do with the loan amount– loans above $720K or so are considered “non-conforming” and have less favorable rates and terms.  The “New Loan Amount Limit” refers to the increase in conforming loan amount limits which have gone up from $417,000 to around $720,000.

Here are some currently available nifty loan programs. Call me if you want names of lenders who can help you get these kinds of rates and terms–.

1) $1.5 million to 80% LTV, Full Doc.
2) Conforming Stated Income and No Ratio still available
3) When 1st loan is Conforming, Only 5% down up to 95% Financing for 2nd loan!
4) New Loan Amount Limit interest rates have finally come down – 30 Yr Fixed is @ 5.875%!
5) New Loan Amount Limit now offering Interest Only products – 5 Yr I/O is @ 5.75%!
6) Limited doc with only 20% down to $750000 loan amount
7) 90% loans to $1,000,000 with a 680 credit score — requires full doc
30 year fixed at 6.125% and 0 points to $729,750 with a 720 credit score. Credit scores of at least 680 can obtain a slightly higher interest rates.
9) 2-4 units 25% down with extremely qualified buyers to $1,100,000 limited doc.

Keep in mind that these were quotes I got today– and in the lending world everything can change in a flash. 

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Back in February I added a posting about how federal conforming loan limits were raised from $417,000 to $729,000. This meant that rates for new “jumbo conforming” loans between $417,000 and $729,000 were supposed to drop.  This was good news, but I added the caveat that it would take awhile for lenders to respond to the new conforming limit while they awaited guidelines from Fannie May and Freddie Mac.

It’s taken three months, but lenders are finally offering favorable rates for these larger loans. Last week a mortgage broker I work with placed a $700,000 fixed loan at 5.875%.  I got a quote from another loan professional at 5.625%.  This makes a purchase of a home in San Francisco at our median price of around $750,000 far more affordable.

This doesn’t mean these loans are easy to get– you still need to go ‘full-doc’ (meaning you need to have a job that provides 1040s and pay-stubs), and put at least 10% down. You also need good credit scores– some of my sources say a minimum 660 is required. Others say your scores need to be at least 700.

Call me if you want to crunch the numbers on a purchase and figure out what you can afford. Getting prequalified and understanding how the numbers work on your monthly payment is a critical first step when shopping for a home. 

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