One of my trusted sources tells me that we'll be able to finance residential loans that were considered "Jumbo loans" (real estate financing above the industry-standard definition of conventional conforming loan limits) which is great news. But the question is, will this reform help the majority of homeowners? In the real world, this update will work for a drastically limited number of borrowers.
It is nevertheless, good news for homeowners living in in expensive metropolitan areas such as Southern California, where median home prices now exceed the $417,000 limit. Borrowers with these programs were subject to higher interest rates due to the slightly higher risk to the lender. To qualify for lower interest rates these mortgages will be eligible if they are granted between July 2007 and Dec. 31, 2008. This bill would also allow the Federal Housing Administration to insure loans up to the same $729,750 limit.
David's mortgage update:
We're floating today due to no economic reports scheduled for release and mortgage bonds remaining unchanged.