Whats the difference between conforming and non-conforming loans?
A conforming loan is one with an original balance of $322,700 (for 2003) or less for a single-family home. The conforming loan limit is adjusted annually at year-end by Fannie Mae and Freddie Mac. Conventional non-conforming or “Jumbo” loans have original loan amounts greater than the conforming loan amount. In most cases, jumbo loans have slightly higher interest rates than conforming loans.
A conforming loan is one with an original balance of $333,700 (for 2004) or less for a single-family home. The conforming loan limit is adjusted annually at year-end by Fannie Mae and Freddie Mac. Conventional non-conforming or “Jumbo” loans have original loan amounts greater than the conforming loan amount. In most cases, jumbo loans have slightly higher interest rates than conforming loans.
