Congressional leaders and the White House reached agreement late last week on a proposal to increase conforming loan limits as part of a larger economic stimulus package. Part of the package will include having the FHA loan limits increased from $362,000 to a high of $729,750 and the GSE (Government-Sponsored Enterprises - i.e. Fannie Mae and Freddie Mac) conforming loan limit would increase from $417,000 to a maximum of $729,750. Also, in order to provide an incentive for lawmakers to work on overall GSE regulatory reform, the loan limit increases for the GSEs are limited to one year. Currently, Californians are forced into more expensive non-conforming jumbo loans, decreasing homeownership opportunities for many and forcing others into more costly - and often riskier - loan products. This package will allow for more homeowners, with home loans up to $729,750, to qualify for better programs and potentially better rates.
While legislation is required to enact this package, Congressional leaders are indicating they will pass it soon.
What this may mean is that for those with loan amounts between $417k and $750k there may be an opportunity to take advantage of the lower interest rate environment until the jumbo market starts to function efficiently again. Please let us know if we can do a comprehensive mortgage analysis for you or an associate.
Lisa Balmes PC, e-Pro
Chris Balmes Properties
503.427.0372
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