If you’re considering a mortgage refinance and live in an area with high property values, upcoming changes to the conforming loan limit could affect you. October 1st of this year the conforming loan limit will be $417,000. If your mortgage is more than this, you’ll have to qualify for a jumbo mortgage loan. Here’s an article from TheTruthAboutMortgage.com that explains the difference between conforming and non-conforming or jumbo mortgage loans:
Put simply, mortgage rates will be cheapest for loans at or below $417,000, while loan amounts between $417,001 and $729,750 (soon to be $625,500), known in some circles as conforming jumbo loans, will be slightly higher.
If your mortgage balance is above the conforming loan limit and you’re thinking about refinancing to take advantage of the lowest refinance rates of the years it will become increasingly difficult once your home loan is considered non-conforming. Lenders consider these home loans to be more risky and the interest rates and qualifying requirements are higher.
There are steps you can take to improve your ability to get for a jumbo mortgage loan by improving your credit. You can learn more about improving your credit before mortgage refinancing and avoiding unnecessary fees by checking out my free Underground Mortgage Videos.