Nation

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Nation - January 1, 2007

2007 FANNIE MAE/FREDDIE MAC CONFORMING LOAN LIMITS
The Office of Federal Housing Enterprise Oversight (OFHEO) announced that the maximum 2007 conforming loan limits will remain at 2006 levels. The conforming loan limit defines the maximum mortgage size that Fannie Mae or Freddie Mac can buy or guarantee in the residential secondary mortgage market. A mortgage beyond that limit is in the jumbo market, which is reserved to private sector mortgage lenders. The conforming loan limits are:
One-unit: $417,000
Two-unit: $533,850
Three-unit: $645,300
Four-unit: $801,950

NAR ISSUES NEW PREDATORY LENDING EDUCATION BROCHURE
NAR and its partner, the Center for Responsible Lending, have issued another consumer brochure in the series "Shopping for a Mortgage? Do Your Homework First." The new brochure focuses on predatory lending and identifies the warning signs of predatory loans. The first two brochures in the series, issued last year, explain the risks and advantages of Nontraditional (Specialty) and Traditional mortgages. NAR, in partnership with the Federal Housing Administration of the U.S. Department of Housing and Urban Development, has also issued a brochure in this series called "FHA Improvements Benefit You." FHA insured mortgages provide a fair and affordable alternative to predatory loans. All four brochures are available for sale on NAR’s website.

NEW LAW MAKES MORTGAGE INSURANCE PREMIUM DEDUCTIBLE

Home affordability and the housing industry received a big boost from Congress, which approved a measure that would for the first time allow lower- and moderate-income homebuyers to deduct the full cost of mortgage insurance from their federal taxes in 2007. The provision was included in the omnibus tax bill approved by Congress on December 9, 2006. The legislation passed makes all mortgage insurance premium payments deductible for homeowners with adjusted gross household incomes of $100,000 or less. It applies to all new mortgage originations beginning January 1, 2007. [Source: REAL Trends E-Mail Update #862]