2007 Conforming Loan Limits-Important Update!

Hello Everyone,

I thought that Real Estate Agents,Lenders and consumers would like to know that the OFHEO (Office of Federal Housing Enterprise Oversight) had a News Release on November 28th 2006, which confirmed that the 2007 Conforming Loan Limit for one unit properties would remain at $417,000 for most of the United States. So, what does this mean for homebuyers and homeowners across the United States? Well, the difference between Conforming and Non-Conforming interest rates today is about .375%. On a $417,000 Conforming First Trust Deed Loan, that equates out to a difference of $100/month.

$417,000 Conforming Loan Amount at 5.75% on a 30 year fixed = $2433.50 (Principle and Interest)

$417,000 Non Conforming Loan Amount at 6.125% on a 30 year fixed = $2533.74 (Principle and Interest)

*The interest rates above are based at PAR pricing on a California Rate Sheet from a major financial institution. The rate is not taking closing costs and/or origination points into consideration.

What many don't realize about the Conforming Loan Amount is that when it increases, it allows people to refinance, taking a larger portion of their loan balance and placing it into the first mortgage at a lower interest rate, decreasing the balances of their second mortgages at the higher interest rates. This can be a great financial tool to help reduce your monthly payments.

That's my mortgage tip and input for the day :)

Scott Gormley
Broker/Owner
Oak Valley Mortgage
2006 Chico Assoc. of Realtors Affiliate Chairman
Direct: 530.592.8362
Fax: 530.267.5555
Website: http://www.caloan.com/

Blog: http://activerain.com/blogs/lendingmagician

"You find the perfect home, we'll find the perfect loan!"