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FEDERAL HOUSING FINANCE BOARD ANNOUNCES HIGHER CONFORMING LOAN LIMIT FOR 1992

FEDERAL HOUSING FINANCE BOARD ANNOUNCES HIGHER CONFORMING LOAN LIMIT
 FOR 1992
 WASHINGTON, Nov. 20 /PRNewswire/ -- Federal Housing Finance Board Chairman Daniel F. Evans Jr. announced today the maximum size of conventional single-family mortgages that can be purchased or guaranteed by the Federal National Mortgage Association (Fannie Mae) or the Federal Home Loan Mortgage Corporation (Freddie Mac) will be $202,300 in 1992. This is an increase of 5.8 percent from the 1991 limit of $191,250.
 Based on data for the first 10 months of 1991, less than 1 percent of conventional mortgages are between the $191,250 and $202,300 limits, and 6.8 percent of conventional mortgages are above the new limit. Loans below the "conforming loan" limit often have a slightly lower interest because these loans can be more easily sold in the secondary mortgage market. So far in 1991, fixed-rate loans at or below the conforming loan limit had an average effective interest rate 0.10 percent below non-conforming loans. In addition, a higher percentage of non-conforming loans than conforming loans have adjustable interest rates.
 The change to the conforming loan limit is based on the percentage change in the all homes average price, as reported in the Federal Housing Finance Board's Monthly Survey of Rates and Terms on Single-Family Conventional Nonfarm Mortgage Loans. The October 1991 average house price is $147,700; it was $139,600 in October 1990.
 Both the Federal National Mortgage Association Charter Act and the Federal Home Loan Mortgage Corporation Act specify that the size of loans eligible for purchase by these agencies will be adjusted each year by the October-over-October percent change in the national average home price as reported in the survey. This monthly survey asks a sample of mortgage lenders to report the terms and conditions on single-family conventional mortgage loans that they close the first five working days of the month. Included in the national sample are savings and loan associations, mortgage companies, commercial banks and savings banks.
 -0- 11/20/91
 /CONTACT: Joseph McKenzie of the Federal Housing Finance Board, 202-408-2845/ CO: Federal Housing Finance Board ST: District of Columbia IN: FIN SU:


SB -- DC009 -- 5296 11/20/91 09:33 EST
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Publication:PR Newswire
Date:Nov 20, 1991
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