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What is the new conforming loan limit in San Francisco?

June 23, 2009

The new conforming loan limit for San Francisco is now $625,500 which is up from $417,000 but down from this year's briefly enacted $729,750 limit. Conforming loans usually offers better rates and borrower qualification guidelines...

I'm told by my mortgage broker friends that rates look really good for buyers who want a loan amount of up to $625,500. With a 10-20% down payment, this could be a really nice condo or house. First time buyers....listen up! This is the best opportunity for you.

General announcement from the San Francisco Association of Realtors:

FHFA Announces “New” Conforming Loan Limits

The Federal Housing Finance Agency (FHFA) on Friday announced that the "new" conforming loan limit for 2009 will remain at $417,000 for most areas in the U.S., unchanged since 2006. Loan limits for high-cost areas, including California, are capped at $625,500, down from the previous $729,750 limit. Loan limits for many areas of the state do not reach this lower threshold and are dramatically reduced from 2008.

"Although price declines mean that the total number of homes eligible for conforming financing has increased, we're disappointed that the $729,750 limit stipulated in the Economic Stimulus Act of 2008 signed in February was not made permanent," said 2008 CAR President William E. Brown. "The reduction in the loan limit to $625,500 will negatively impact both the interest rates and the availability of funds for jumbo mortgages. We hope Congress will make the $729,750 limit permanent before the end of the year as one of the provisions in an economic stimulus package."

The conforming loan limit determines the maximum size of a mortgage that Government Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac can buy or guarantee. Non-conforming or jumbo loans typically carry a higher mortgage interest rate than a conforming loan, increasing the monthly payment and negatively impacting affordability for households in California.

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