Now how about loans that aren conforming?
Jumbo loans do not experience exactly the same cycle as conforming loans. These larger loans must be purchased by private investors, who don’t buy in the same volume as Fannie or Freddie, so their bundles contain fewer loans overall. When they bring these bundles to Wall Street, they are hit with a fee just like Fannie and Freddie, but the fee must be spread among fewer loans.
