Fannie & Freddie Loan Limits to Stay at $417,000

James Lockhart, the Office of Federal Housing Enterprise Oversite director said in a statement today that “While the house price survey data used in determining the conforming limit shows a decline over the past year.. the level will remain at $417,000 for the third straight year.”

The conforming limit for Fannie Mae & Freddie Mac limits the largest sized loan that they can purchase in the secondary market. This limit is typically aligned with the average home prices across the nation, but recently government officials have called for the limit to be increased in the face of the current housing financial crisis. Federal Reserve Chairman Ben Bernanke and Treasury Secretary Henry Paulson stated back on September 20th that they would both endorse a temporary increase in loan limits to help add liquidity into the jumbo loan market. Fannie Mae & Freddie Mac were both agencies created by the government to increase the liquidity of the mortgage market. With the recent accounting problems that both of these companies have been facing it has been difficult for them to do this.

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