The Veridian Blog

Many of you have asked if and when the new conforming loan limits will take affect.  As part of the Economic Stimulus Plan, the conforming loan limit will be raised in the nation's most affluent areas from the current $417,000 level to $729,750 as early as next week when Congressional leaders hope to have it on President Bush's desk for signing.  It was passed by the Senate last Friday already.

What is the significance of this provision?  Since last August, the spread between the typical 30-year fixed Jumbo and 30-year fixed Conforming has been about 1.0%.  By allowing more Jumbo loan holders access to conforming rates, many will benefit by as much as $5000 per year.

In the Silicon Valley, it is estimated that there are 105,000 Jumbo loans, and in the State of California, about 1 million.  IF you currently have a Jumbo loan (especially between $417,000 and $730,000)  please call us so we can put you on the rate lock hot list.  As soon as the bill passes, we expect heavy volume and it will be imperative to begin your process as turnaround times will swell overnight.

Also, please keep in mind - the measure was written as a temporary stimulus and expires on December 31.  It certainly can be renewed by Congress, depending on how the economy is doing at the end of the year.

Call us with any questions!

Richard