{
  "id": "RS22172",
  "type": "CRS Report",
  "typeId": "REPORTS",
  "number": "RS22172",
  "active": true,
  "source": "EveryCRSReport.com, University of North Texas Libraries Government Documents Department",
  "versions": [
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      "source": "EveryCRSReport.com",
      "id": 422987,
      "date": "2013-08-02",
      "retrieved": "2016-04-06T21:02:39.680684",
      "title": "The Conforming Loan Limit",
      "summary": "Congress is concerned with the pace of the recovery in the housing and mortgage markets. A series of laws starting with the Economic Stimulus Act of 2008 (ESA; P.L. 110-185) were designed to increase the availability and affordability of mortgages in \u201chigh-cost\u201d areas. This concern about housing and mortgage markets is balanced by attention being paid to possible taxpayer financial risks and the desire to minimize government intervention in economic markets.\nTwo congressionally chartered government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, provide liquidity to the mortgage market by purchasing residential mortgages from the original lenders and either reselling them as mortgage-backed securities to investors or holding them as investments in their own portfolios. Their charters include a ceiling on the size of loans the GSEs can buy.\nSince the end of FY2011 (September 30, 2011), the maximum limit in high-cost areas was reduced to $625,500 from $729,750. The current high-cost limit is calculated as 115% of the area median house price, but cannot exceed 150% of the national limit or $625,500. The limit in other areas of the nation remains unchanged since 2006 at $417,000.\nSecuritization of mortgages that exceed the applicable limit\u2014called non-conforming jumbo loans\u2014is done by private financial institutions, although in the present financial environment virtually no jumbo mortgages are being securitized. GSE status allows Fannie and Freddie to issue debt at lower cost than other private firms; part of this subsidy is passed on to home buyers in the form of lower interest rates. Interest rates on jumbo mortgages are slightly higher than those on the conforming loans that the GSEs can purchase. The spread between non-conforming jumbo and conforming loan rates has been elevated since the start of the financial crisis and is now about three-fourths of 1%.\nAccording to recent congressional testimony, most recent home purchase mortgages are guaranteed by FHA and securitized by Ginnie Mae; the majority of mortgages purchased recently by Fannie Mae and Freddie Mac have refinanced existing mortgages.\nS. 1217, the Housing Finance Reform and Taxpayer Protection Act of 2013, would reduce the maximum high-cost limit from 150% of the national limit ($625,500) to 130% of the national limit ($542,100). H.R. 2767, the Protecting American Taxpayers and Homeowners (PATH) Act of 2013, could reduce the high-cost limit to $525,500.\nThis report analyzes the implications of the higher conforming loan limit in high-cost areas. It will be updated as legislative and market developments warrant.",
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      "topics": [
        {
          "source": "IBCList",
          "id": 2869,
          "name": "Housing Finance Reform"
        }
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    {
      "source": "University of North Texas Libraries Government Documents Department",
      "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc814884/",
      "id": "RS22172_2009Nov02",
      "date": "2009-11-02",
      "retrieved": "2016-03-19T13:57:26",
      "title": "The Conforming Loan Limit",
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    {
      "source": "University of North Texas Libraries Government Documents Department",
      "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc818876/",
      "id": "RS22172_2009May13",
      "date": "2009-05-13",
      "retrieved": "2016-03-19T13:57:26",
      "title": "The Conforming Loan Limit",
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    {
      "source": "University of North Texas Libraries Government Documents Department",
      "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc807334/",
      "id": "RS22172_2008Dec31",
      "date": "2008-12-31",
      "retrieved": "2016-03-19T13:57:26",
      "title": "The Conforming Loan Limit",
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    },
    {
      "source": "University of North Texas Libraries Government Documents Department",
      "sourceLink": "https://digital.library.unt.edu/ark:/67531/metacrs7956/",
      "id": "RS22172 2005-06-22",
      "date": "2005-06-22",
      "retrieved": "2005-12-21T17:06:06",
      "title": "Proposed Changes to the Conforming Loan Limit",
      "summary": null,
      "type": "CRS Report",
      "typeId": "REPORT",
      "active": false,
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      "topics": [
        {
          "source": "LIV",
          "id": "Executive departments",
          "name": "Executive departments"
        },
        {
          "source": "LIV",
          "id": "Mortgage loans",
          "name": "Mortgage loans"
        },
        {
          "source": "LIV",
          "id": "Government-sponsored enterprises - U.S.",
          "name": "Government-sponsored enterprises - U.S."
        },
        {
          "source": "LIV",
          "id": "Housing",
          "name": "Housing"
        },
        {
          "source": "LIV",
          "id": "Finance",
          "name": "Finance"
        }
      ]
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  ],
  "topics": [
    "Economic Policy"
  ]
}