The jumbo mortgage business keeps getting bigger for banks.
These high-dollar home loans rose to 24% of mortgage approvals at six of the largest U.S. banks in 2015 from 21% the year before, according to an analysis of federal home-loan data. These mortgages to the affluent, typically worth more than $417,000, have become increasingly popular among big banks in the wake of the mortgage crisis.
Jumbos are attractive because they typically feature borrowers with high credit scores, big down payments and low default rates. And they aren’t linked to government programs that help back home loans—programs that cost banks tens of billions of dollars in fines after the financial crisis.