Fannie and Freddie Conforming Loan Limits Will Stay the Same

By Sari R. Updated on 11/29/2012

Fannie Mae and Freddie Mac just announced today that they are going to keep maximum conforming loan limits the same.  The Federal Housing Finance Agency (FHFA) stated that the max loan limit will stay at $417,000 for one-unit properties.  This loan limit can still be increased to $625,000 in certain areas that have been designated as high-cost. 

Loans that were originated before October 2011 will still have a maximum loan limit of $729,750.  This loan ceiling was created underneath legislation that won’t be relevant for mortgages originated in 2013.  In 2012, President Barack Obama implemented a law that would reinstall higher conforming loan limits for the FHA until the end of 2013.  This piece of legislation will allow the FHA to insure loans of up to $729,750 in the country’s high-cost areas.

This decision spurred a backlash from opponents who suggested that larger loan limits undermined the Treasury’s intent to phase out the government-backed housing system and bring back private capital.  Gary Ackerman (D-N.Y.) and John Campbell (R-Calif.) introduced this particular bill today that prolonged the conforming loan limit for government-insured mortgages.

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