Did you see the article by Sue McAllister in the Mercury News regarding loan limits?
A little history – For a long time, loan amounts have been broken down into conforming and jumbo loans. Right now, a conforming loan amount is under $417,000 and usually gets a better interest rate. And yes, you guessed it, jumbo loan amounts are larger than $417,000. Earlier this year, as part of the economic stimulus bill that was put into effect around February of 2008, a conforming jumbo loan amount was created for loans from $417,000 to $729,000 which gave a better rate than jumbo loans but not as good as conforming but provided more opportunities for Buyers.
The conforming jumbo loans will expire December 31st. In Santa Clara County, the maximum for loans backed by Fannie and Freddie will drop to $625,500 as of January 1st, 2009. The new limits are affecting Buyers even earlier than January because many lenders won’t accept applications for conforming jumbo loans unless they can be closed by mid-December. Lois Jones of Bank of America here in Morgan Hill, says if you are depending upon a conforming jumbo loan, you should close your transaction by December 10th of 2008 at the latest.
Feel free to comment or contact me for additional information.