What's the size limit for a conforming loan in 94131?

Asked by Michael Ailurt, San Francisco, CA Wed Feb 25, 2009

I read somewhere that jumbo loans have historically run about 0.30% higher than conforming loans, but that lately the differential has spiked to more than 1.5%. Is this right? How large can a loan be in 94131 to qualify for the lower conforming rates?

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Steven Ornel…, Agent, Fremont, CA
Wed Feb 25, 2009
Hi Michael, , the Jumbo-Conforming spread was about 1.8% late Jan/early Feb but today it's about 1.44% (going in the right direction for sure). Historically, and until July 2007, the spread or difference between conforming mortgage rates and jumbo rates moved within a narrow range of about 0.20%.

The new conforming loan limits go by County. For San Francisco County, single family, its $729,750
You can search for other countirs here: https://entp.hud.gov/idapp/html/hicostlook.cfm

Best, Steve
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Mike Ackerman…, Agent, San Francisco, CA
Wed Feb 25, 2009

Yes you are right! The lenders will quote you rates from the old conforming loan limit all day long... That loan limit is $417,000 which can buy you a nice condo up on the hill and that's just about it.

The 'jumbo' conforming loan limit is still $625,500. For this you will pay a little higher rate and someday soon the stimulus package will allow to raise it from $625,500 to $729,750 but we'll have to wait for several conditions from the lenders for that to happen... I'd expect to see three different rates at each of these levels.

Now let's talk.. As these rates are all good!!! When I purchase my first home in 1983, rates were 13 - 15%!!!! I think people lack that perspective. If you are interested in knowing more, I can refer you to some great direct lenders and mortgage brokers whom I've worked for years... Just let me know.

Now don't forget your tax credit... That's a real deal!!! - Checkout the web reference below and click the link for $8,000 Tax Credit - Good for first time homebuyers up until December 1, 2009!

Thanks for asking!

Michael Ackerman
Zephyr Real Estate
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Eileen Bermi…, Agent, San Francisco, CA
Wed Feb 25, 2009
Hi, Michael--Funny you should ask, I was just finalizing my Inside SF Real Estate blog post for tomorrow on that subject. The conforming loan amount is currently $625,500, but it will increase soon to $729,750.

If you're considering purchasing a home in San Francisco, you'd be looking at needing a 10% down payment, which would put your purchase price max at around $695,000. There are FHA loans available that require less down payment, but your purchase price would shift accordingly.

In case you're wondering what's available for up to $695,000--assuming you're working with a 10% down payment--here is the scoop: There are 210 single-family houses on the market, ranging in price from $179,000 for a 625-square foot, one-bedroom short sale house that's tenant occupied in Bayview, to a three-bedroom home in Bernal Heights on College Terrace. In addition to Bernal and Bayview, neighborhood selections include Merced Heights, Ingleside, Outer Sunset, and Sunnyside.

There are 493 condos available, but it's important to have your lender or mortgage broker review a particular building prior to even considering making an offer. Lenders are hesitant to lend on condo buildings, so there are further limitations to what you may be able to purchase.

I'd recommend considering properties priced as high as $725,000-$750,000, as your chances of negotiating for what you can afford increase the longer the property sits on the market--presuming you have a motivated seller on hand.

May be more info than you need, but I thought you may be interested in the full scope of things in the city.
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