Both houses in the Congress have approved the economic bill which includes an increase in the conforming loan limit. The bill is set to go to President Bush, and is expected to be signed by Feb 15. The bill includes a one-year increase in the conforming loan limit to $625,000 nationwide and up to $729,000 in high-cost areas such as San Francisco and Marin County for loans that government-sponsored enterprises Fannie Mae and Freddie Mac can purchase.
What this means to Marin County buyers and homeowners:
If President Bush signs the bill, buyers in the lower end of the Marin market or buyers making large down payments will have more buying power. Currently, the interest rates on jumbo loans are more than a percent higher than conforming loans. We are also likely to see a slew of refinances, which could reduce the mortgage payments of many Marin residents with loan balances currently between $417,000 and $729,000.
The increased loan limit could also provide a confidence boost for struggling areas such as Novato and parts of San Rafael, where borrowers and buyers are more likely to be positively impacted by the increase.