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Conforming Loan Limits Expire End of Year

As part of the recent economic stimulus package the FHA conforming loan amount was raised in New York from $417,000 to $729,750. The $729,750 conforming loan amount expires the end of 2008.

$729,750 is 80% of $912,000. $729,000 is 85% of $858,000. Most coops require a minimum of 20% down and although condos only require 10% down most lenders currently are requiring a minimum of 15% down.

Loans for more than $729,750 are called jumbo loans. Interest rates are much higher on jumbo loans. Because of the credit crises jumbo loans are harder to qualify for and rates are risings. Jumbo loans are not backed by the government they have been sold on the secondary market and there are less investors interested in them these days.

Perhaps there will be another stimulus package that will raise the conforming loan amount for New York again but it expires the end of the year. The loan amount is expected to either go back down to $417,000 or In the $600K range.

At first coops were not eligible for the $729,750 loans. Coops are allowed now unfortunately there is such a short window in Manhattan to take advantage of the lower rate.

Any buyers on the fence, if you need financing, buying and closing before the end of 2008 will save you a lot in monthly payments. It is a buyer's market, there are many great deals on beautiful apartments.

Now is a great time to buy and close on a Manhattan apartment before the end of the year. Start the new year in a new home.

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