The Office of Federal Housing Enterprise Oversight (OFHEO) announced the maximum 2008 conforming loan limit for single-family mortgages purchased by Fannie Mae and Freddie Mac will remain at the 2007 level of $417,000 for one-unit properties for most of the U.S. Higher limits apply to Alaska, Hawaii, Guam and the U.S. Virgin Islands, as well as to properties with more than one unit.
The conforming loan limit determines the maximum size of a mortgage that the government-sponsored enterprises can buy or guarantee. By law, the maximum conforming loan limit is based on the October-to-October change in the average house price in the Monthly Interest Rate Survey of the Federal Housing Finance Board (FHFB). The FHFB reported the decline in the average price was $10,685 or 3.49%, from $306,258 in October 2006 to $295,573 in October 2007. The combined two-year decline is now 3.65%.
‘While the house price survey data used in determining the conforming loan limit show a decline over the past year, as previously announced and consistent with the proposed new conforming loan limit guidance, the level will remain at $417,000 for the third straight year,’ says James B. Lockhart, director of OFHEO.