Because parts of the American Recovery and Reinvestment Act were set to expire, the conforming loan limit was about to reset back to $417,000. This would have crushed many borrowers in Santa Cruz County as well as many other high cost areas. Recognizing this, President Obama just signed HR3081, extending the current loan limit of $729,750 through September 30, 2011.
Interest rates tend to be the most advantageous for borrowers using conforming loans; jumbo loans tend to have higher interest rates. Government sponsored organizations that insure and provide liquidity in the market use the conforming loan limits (Fannie Mae, FHA, and Freddie Mac). Today, there were lenders making 30 year loans at 4.25%. For more information - click below: http://www.inman.com/news/2010/09/30/fannie-freddie-fha-loan-limits-extended
Separately, local lender Mi Unger from RPM Mortgage told me today that they now have two sources of FHA financing that may loan on a property that has some unpermitted construction. For countless rural homes throughout Santa Cruz County and San Lorenzo Valley, this will increase the ability of buyers to get financing on homes that have been altered over the years without benefit of permit. Naturally there are conditions and restrictions, but this is an improvement over the outright ban that was in place previously.
For more information, you can e-mail Mi at miloan@sbcglobal.net
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