Good news for home buyers in 2006. The Loans limit has been raised from $359,650 to $417,000, which is the single largest rise since 1980. This giant hike in the conventional loan should a lot of homebuyers to buy that elusive home without having to opt for the higher interest jumbo loans.

A conventional loan is the loan that most homebuyers get when they want to buy a home. This is also the loan that lenders refer to in their advertising for their best interest rates. These new limits are important to lenders as this helps them to peg their interest rates to the stand 30 year mortgages.

According to experts the only buyers who will really benefit from this recent hike will be with higher incomes. According to Freddie Mac and Fannie Mae about 500,000 buyers in high-priced areas such as New York City, Los Angeles, Chicago and Seattle will benefit. The $417,000 mortgage when added to a good down payment should allow the buyers in these areas to get a decent home without attracting the higher jumbo mortgage interest rates.

This entry was posted on Friday, December 16th, 2005 at 2:19 pm and is filed under News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.