No jumbos for Fannie, Freddie

Not a shocking piece of news, but a development worth noting: "Mortgage finance companies Fannie Mae and Freddie Mac will not be able to invest in loans valued above $417,000 next year, their regulator said on Tuesday, saying it will hold the current loan limit steady."

More: "The so-called "conforming loan limit" will be held in place despite falling home prices around the nation, said the regulator, the Office of Federal Housing Enterprise Oversight.

Your thoughts? Comments? Insights? Email story tips to lalandblog@yahoo.com.

Comments

[MyLessThanPrimeBeef]

I know I have been fooled too many times before, but it appears that the insanity at Freddie Mac and Fannie Mae was just temporary.

[Rob]

Is it really a house of cards? Whats next 9.5% loans from BofA "because we can" slogan........

[tew]

This is not a surprise given the turmoil at both. Their balance sheets are in bad shape.

I think Congress could still make the regulator change its mind though.

[TakeFive]

Awwwww - where is Countrywide going to find another sucker to unload those loans on?

I just love this part of the article:

"The conforming loan limit is typically pegged to average home prices across the nation but allies of Fannie Mae and Freddie Mac have called for the limit to be eased in the face of the current housing finance crisis."

After suffering a $2B writedown, "allies" are trying to increase the loan limits?! Whoever had the stones to say no to that deal - buy him a round on me. Guess the lobbyists underestimated how big a sack of cash they needed to bring.

[upthecrekk]

OH BOY!!! What a surprise.....No jumbo loans ..I wonder why????
Go ask Angelo Or shall I say The new blue man

[Paul U.]

Well, since median income family cannot even afford to buy a $417,000 house, why would they need to increase the limit????
the whole idea of the conforming loans is to help get median families into buying a house.
If someone can afford to buy a house for $1,000,000 or more...Let him pay for it using free market loans or cash...
Besides, 90% of the house even in california and specifically southern california and even more specifically SFV, do NOT even worth $417,000. A better figure for an average SFV home is probably $250,000 and that is pushing it...
think about it.