From the Los Angeles Times' Money & Co. blog:
People who hold jumbo loans on pricey U.S. properties continued to struggle in January as more Americans lose their jobs and property values have plummeted, according to a report released Monday.
Jumbo loans were popular -- and often necessary to afford homes in pricey areas like Southern California -- during the heady years of the boom.
Jumbo loans are generally defined as being above certain conforming limits set by mortgage titans Freddie Mac and Fannie Mae. (The conforming limit for single-family homes was $417,000 from 2006 to 2008 but was increased temporarily by federal lawmakers in early 2008 to $729,750 in certain high-cost areas, including Los Angeles County.)
Overall, delinquencies of 60 days or more on prime jumbo loans that were packaged into securities and sold to investors rose to 9.6% in January, up from 9.2% in December and 3.7% a year earlier, according to the report by the Fitch Ratings agency in New York.
California, which comprises 44% of the market, saw its delinquency rate rise to 11.3% in January from 10.8% in December and 4.1% a year earlier....MORE