While industry groups furiously lobby, it’s now t-minus two weeks until the super/jumbo conforming loan limits that provide for federally backed mortgages up to $729,750 in high cost areas like San Francisco are set to expire on September 30.
As we first reported two weeks ago, it would appear as though Obama’s administration has changed its position and would now support a two-year extension despite the Treasury Department’s recommendation to let the limits reset lower.
Co-sponsored by California Senator Diane Feinstein, the Homeownership Affordability Act of 2011 which would extend the higher loan limits through the end of 2013 has been referred to the Committee on Banking, Housing, and Urban Affairs but hasn’t made much progress since being introduced at the beginning of August.
With two days to go, we’re calling it 99 percent certain that super conforming loan limits are dead in the water and the upper limit for qualifying loans in San Francisco will officially drop from $729,750 to $625,500, having effectively been in place for a month.
While we don’t expect the change to have a radical impact on the market, we do expect to see an impact on liquidity and values in the $650,000 to million dollar segment due to potentially higher down payment requirements and rates.
∙ T-Minus Two Weeks Until Higher Loan Limits Set To Expire [SocketSite]
∙ If Lowering Rates Isn’t Working, Perhaps Increasing Limits Will [SocketSite]
∙ Conforming Loan Limit Extension Gains Obama’s Support [SocketSite]
∙ Homeownership Affordability Act of 2011 [loc.gov]