The Federal Housing Finance Agency (FHFA) says that the maximum conforming loan limits for mortgages originated in the first nine months of 2011 will remain unchanged from existing loan limits for 2010 originations. Those limits are generally $417,000 but can be as much as $729,750 in certain high-cost areas of the contiguous U.S.
The FHFA adds that the national limit was left unchanged based on prior declines in FHFA's monthly and quarterly house-price indexes over the past three years. Under the terms of the Housing and Economic Recovery Act of 2008, the national loan limit is to be adjusted each year to reflect changes in the national average home price, but it does not permit declines in the national loan limit. If average home prices decline, then the national loan limit is to remain the same – but when prices increase, the loan limit is to be raised only if the magnitude of the increase exceeds the cumulative price declines that occurred in preceding periods.