What’s really going on with the conforming loan amount changes?

There had been a lot of rumors about the conforming loan amount being increased from the current $417k (it’s been the same amount in 2006, 07, and as well currently in 08).   But it has not taken in effect yet…  The most recent rumor indicates that it may “take effect” over the next 4-8 weeks (meaning in February or March).  But no one knows, and no one will know until the day it really happens.


In May 2007 the House of Representatives passed H.R. 1427,  it’s a reform act that increases conforming loan limit in high-cost areas to the lower of:

1. 150 percent of the national limit  OR
2. the  median price in such area

Based on the most recent calculation provided by a publication I dug up dated January 11, 08 from the Office of Federal Housing Enterprise Oversight (OFHEO),  if this reform went into effect, the single family home conforming loan amount should increase to $625,000 from $417,000.  If the housing market doesn’t drop further, the range MAY BE between $625k to $710k.

Message to the buyers in the Bay Area.  Given the  rate cut and potential  conforming loan limit increase, it’s time to be on the look out for some refi opportunities.



  1. ingipuff said

    More information from curbed SF. http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/01/25/MNS7UL6SQ.DTL&feed=rss.business

  2. Ingrid Yen said

    It’s been confirmed by Barbara Boxter that we will be raising the conforming loan limit in SF.

    -Barbara Boxter…
    H.R.5140 also addresses the mortgage foreclosure crisis by temporarily raising loan limits for federally backed mortgages to $729,750, which would allow many borrowers who have or are seeking higher interest jumbo loans to qualify for lower interest rate conforming loans. This will help our families lower their monthly mortgage payments and even save their homes from foreclosure.

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