Jumbo Loans Get Supersized -- Again
It's official: The dividing line for jumbo mortgages in the Washington region (and other high-cost areas around the country) is now $729,750. Below that, Fannie Mae and Freddie Mac can buy a loan. From there on up, it’s a jumbo, and costs more.
An announcement by the Federal Housing Finance Agency makes it clear that the new “conforming loan limits,” which govern the size of mortgages that can be purchased by Fannie and Freddie, have been returned to that higher dollar amount, which was in effect last year.
The change back is thanks to the economic stimulus package recently signed into law. That’s important to home buyers and refinancers because jumbo mortgages carry higher interest rates.
This bouncing around of the jumbo-loan threshold is unprecedented. Through much of last year, the cutoff point was $729,750, but the government reduced the number to $625,500 as of January 1. The once-again higher limit now applies to all mortgages made in 2009.
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