In case you haven’t heard, the federal government has changed the conforming loan limits as part of President Bush’s economic stimulus plan. This affects which mortgage loans are considered “conforming loans” and which are considered “jumbo loans”. Jumbo loans carry a higher interest rate than conforming loans. Rather than setting a standard conforming loan limit that is the same across the country, Bush’s economic stimulus plan sets the limit for conforming loans according to the home prices of each local area. The conforming loan limit for Clark County (and the rest of the Portland metro) has now been raised to $418,750 and that will be valid through December 31, 2008.

What does this mean to you? There are two possible ways this change can affect you:

1) If you are interested in buying a home, you can now carry a mortgage up to $418, 750 without having to pay higher jumbo interest rates. Essentially, you can now afford more home at a lower monthly cost.

2) If you have been carrying a jumbo mortgage and the balance on your loan is now $418,750 or less, you can refinance into a conforming loan and lower your interest rate substantially. This can save you quite a bit of money now and in the years to come.

Remember, the deadline for this new limit is currently set at the end of the year. While it may be extended, there is a chance that it could be lowered next year. So if you fall into either of the above two categories, you’ll want to act on this opportunity soon!

I can answer any other questions you have about conforming and jumbo loans and would love to help you get the best loan at the best interest rate available to you. Call me at (360) 907-9111.

Have a great weekend and enjoy the sunshine!

Chris Hyde
Mortgage Consultant