Real Estate
Wealthy Mortgage Borrowers Face Cold Shoulder From Lenders
- Jumbo credit tightened more than other home loans in March
- Lenders grow cautious on big loans without government backing
Photographer: Patrick T. Fallon/Bloomberg
The wealthiest, most-reliable mortgage borrowers in the U.S. are hearing an unfamiliar word from lenders: No.
The global pandemic has flipped the mortgage market upside down, turning the industry’s most-valued customers into risky bets. When the rich lose income and stop paying, costs for lenders are magnified because the loans -- known as jumbos since they are bigger than most conventional mortgages -- don’t have the government to backstop losses.