Interest rates on mortgages for pricey homes have dropped below those on smaller mortgages, an event that has never happened before. Borrowing rates for jumbo mortgages, which are too big for government backing, historically have been set higher than rates on what are known as conforming loans, which are backed by Fannie Mae, Freddie Mac or government agencies. But in the past two weeks, the relationship has flipped as a result of a combination of interest-rate volatility, government policy and banks flush with cash that are enjoying lower funding costs, making jumbo mortgages an attractive investment for them.
