First Colony Real Estate

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Fannie Mae Announces Higher 2004 Conforming Loan Limit of $333,700; Higher Limit Will Bring Mortgage Savings to More Americans

WASHINGTON, DC -- Fannie Mae (FNM/NYSE), the nation's largest source of financing for home mortgages, today announced that it will apply new federal data on mean (average) home prices to increase its single-family mortgage loan limit to $333,700 for 2004, from $322,700 in 2003.

"Interest rates are significantly lower on conforming mortgages than on jumbo mortgages," said Fannie Mae Chairman and Chief Executive Officer Franklin D. Raines. "By obtaining a mortgage that Fannie Mae is eligible to buy, in 2004, as many as 95,000 home buyers could save up to $21,900 over the life of a 30-year mortgage."

Fannie Mae adjusts its conforming loan limits annually. The conforming loan limits are based on the October-to-October changes in the mean (average) home price, as published by the Federal Housing Finance Board (FHFB). The FHFB figures come from its monthly survey of lenders. Both new and existing homes are included in the survey.

Limits for multi-unit loans for 2004 will be as follows: two-family loans $427,150; three-family loans $516,300; and four-family loans to $641,650.

The maximum amounts for one-to-four family mortgages in Alaska, Hawaii, Guam, and the U.S. Virgin Islands are 50 percent higher than the limits for the rest of the country. The 2004 loan limit for second mortgages will be $166,850; in Alaska, Hawaii, Guam, and the U.S. Virgin Islands, it will be $250,275.

Most loans Fannie Mae purchases are well below the conforming limit. Our average loan size for single-family properties in 2003 is about $150,000.