HSH Associates Reports: 2006-2012 Conforming Loan Limits

2006-2012 "Conforming" (FNMA/FHLMC) Loan Limits

Every year, new loan limits are announced for one- to four-family loans which may be purchased by the Federal National Mortgage Association (FNMA, or Fannie Mae) and the Federal Home Loan Mortgage Corporation (FHLMC, or Freddie Mac). These corporations are the two largest "secondary market" agencies -- corporations which purchase closed loans from mortgage lenders.

For 2007 through 2012, however, the base loan limits remain unchanged from their 2006 levels:

The maximum loan amounts for one-to-four family mortgages in Alaska, Guam, Hawaii and the U.S. Virgin Islands are 50% higher than the limits for the rest of the country.

"Conforming" loans are so called because (among other features) the loan sizes 'conform' to the maximum loan amounts which may be purchased by the Federal National Mortgage Association (FNMA, or Fannie Mae) and the Federal Home Loan Mortgage Corporation (FHLMC, or Freddie Mac). "Jumbos" are mortgages with loan amounts which exceed the current FNMA/FHLMC limit. (Click here for a history of conforming loan limits.)

Expanded Fannie Mae and Freddie Mac Maximum Loan Amounts for High-Cost Areas

Although Fannie and Freddie's loan purchase limits are also usually set by a formula, certain changes were made back in March 2008 to allow them to temporarily buy mortgages beyond their traditional limits.

Loans originated on or after October 1, 2011 use the "permanent" high-cost area loan limits established by FHFA under a formula of 115% of the 2010 median home price, up to a maximum of $625,500 for a 1-unit property in the continental U.S.. The high-cost area loan limits are established for each county (or equivalent)

Like the FHA program, you'll need to look up your limits to see what's available to you. We've captured a spreadsheet from the GSEs which can allow you to look up your market to see if an "agency jumbo" is available to you. It's available here (XLS file).

After that, these higher maximum limits will drop back. The GSE's $417,000 maximum will still be available everywhere, with just a select few "high-cost" markets eligible for these higher-maximum "agency jumbos" up to $625,500.

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