Jumbo defaults on the rise as rich lose jobs, income

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Jumbo mortgage holders are now defaulting on their loans at the fastest pace since 1992, Bloomberg News reports. The article blames the defaults on economic troubles hitting the wealthy, not on poor underwriting of the loans.

The jumbo default rate of 2.57% is still far lower than the roughly 20% subprime default rate, the article notes, but jumbo defaults are multiplying. (Of course, in California, you might have a jumbo loan and not be so wealthy.)

-- Peter Y. Hong