Tax Law Could Further Slow Down A Bank Favorite Jumbo Mortgages
The jumbo-mortgage market has been a bright spot for the banking industry in recent years. The tax law could take some of the shine off it.
The tax-code overhaul, among its many other consequences, eliminates some of the benefits of homeownership, particularly for high-end homes. And the borrowers who buy those homes are exactly whom banks have been targeting.
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“The banks really like jumbo mortgages,” said Guy Cecala, publisher of the trade publication Inside Mortgage Finance. “It’s a business they’ve become increasingly reliant on.” Last year, jumbo mortgages hit their highest level since 2006 by dollar volume, according to the publication’s estimates.