Being a Certified Mortgage Planning Specialist has it’s advantages. On being up to the minute updates on legislative changes that impact the mortgage industry. I just received this email from CMPS which is speculating that the new conforming loan limit in the Seattle-Bellevue-Everett area may be $531,377. HUD has 30 days to publish what will be used for median home prices. Here is the memo from CMPS:
CMPS Legislative Update – Determining "High Cost" Areas
As we reported to you yesterday, the US Senate passed an expanded version of HR 5140 – an economic stimulus package that includes a temporary increase in the conforming loan limits from $417,000 to as high as $729,750 in high cost areas. The two things you must know in order to determine if you are in a high cost area:
1. You must know the formula. If 125% of the local area median home price exceeds $417,000, the temporary loan limit would be that 125% of the median home price with a cap of $729,750.
2. According to HR 5140, the Secretary of Housing and Urban Development will publish the median house prices within 30 days. We contacted the Public Affairs office of HUD directly to ask if there is anything definitive to reference in the interim, and they said, "no." The Wall Street Journal published median house prices recently, and you may want to reference this information to get an idea of which areas will exceed the $417,000 limit. The median housing prices can be found in the second graphic on this web page.
This will be great news for those with "jumbo mortgages" or piggy backs that need to refinance. Once I have more "firm" information, you can bet I’ll let you know!