Increasing loan limits to $1 mil creates more options for the 450,000 ARM mortgages that are going to reset EACH QUARTER in 2008
Some of these resetting mortgages could qualify for conforming GSE loans if the loan limits were increased – otherwise these people will be looking for jumbo mortgages that may or may not exist at affordable rates
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Question for you, justme: do you think it is appropriate to offer $1 mil loans via programs that are intended for low-income people who are trying to purchase affordable housing? Do you have a problem that your tax dollars will back these $1 mil loans?
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