Jumbo Production Off Like a Rocket in Third Quarter

Mortgage bankers funded $40.8 billion worth of jumbo mortgages in the third quarter, a handsome 63% gain from the same period a year ago, according to exclusive survey figures compiled by National Mortgage News and the Alternative Products Quarterly Data Report.

As reported by NMN recently, interest in jumbo securitizations is increasing and more banks are holding the paper on their books, earning a nice spread over their cost of funds.

In many cases, jumbos are interest-only loans that mature in seven years—though more firms are offering 30-year products as well.

In 3Q the top funders of jumbos include Wells Fargo ($7 billion in originations), Bank of America ($5.5 billion), PHH Mortgage ($5.4 billion), Chase ($4.2 billion) and CitiMortgage ($2.5 billion).

Wells’ figure, however, is an estimate. The bank released an overall production number for the quarter and declined to provide specifics on jumbos, but it’s well known that the company (29% origination market share overall) is a key player in the sector.

Among the top 10 jumbo producers, U.S. Bank Home Mortgage had the highest growth rate at 112%. U.S. Bank ranked sixth overall.