Prospect Mortgage Offering Jumbo Loans on Secondary Market
SHERMAN OAKS, Calif., March 9, 2011 /PRNewswire/ -- Taking advantage of a thawing market for private-label mortgage securities, Prospect Mortgage began offering prime jumbo loans with balances up to $2 million to the secondary market in February 2011.
The prime jumbos being offered by Prospect, one of the nation's largest independent residential retail lenders, are 30-year, fixed-rate and adjustable-rate mortgages with minimum credit scores of 700 and a 20% down payment for balances up to $1 million, and a 30% down payment and two appraisals for loans between $1 million and $2 million.
Since the market for private-label mortgage-backed securities collapsed in late 2007, nearly all mortgage securities currently offered are those backed by the government-sponsored enterprises Fannie Mae and Freddie Mac. But growing demand from Wall Street and investors for jumbo mortgage issues has signaled an emerging opportunity that is gathering momentum. In April 2010, a publicly traded real estate investment trust offered the first jumbo mortgage-backed security the market had seen in 18 months.
However slowly and cautiously investment firms are approaching their re-entry into the private-label mortgage-backed securities market, it signals a turning point for improved liquidity and reducing the market's reliance on government backing to cover mortgage default risks.
"Although Congress has extended the GSE's upper-end conforming limit of $729,750 until September 30 of this year, that ceiling is only available for a limited number of high-cost areas," said Ron Bergum, Prospect's Chief Executive Officer. "We are focused on producing fully documented prime loans through well-qualified buyers who need jumbo mortgages in markets with a $417,000 conforming limit, and then offering those loans to investment firms that are first movers back into jumbo securitization."
Although it is expanding jumbo lending efforts in 2011, Prospect is the fourth largest FHA purchase lender in the nation, and conforming loans remain the vast majority of the company's funded mortgages, said Mr. Bergum.
About Prospect Mortgage
Headquartered in Sherman Oaks, CA, Prospect Mortgage is one of the largest independent residential retail mortgage lenders in the United States. It is backed by Sterling Capital Partners, a leading private equity firm with approximately $4 billion of assets under management. Read more about Prospect at MyProspectMortgage.com.
SOURCE Prospect Mortgage
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