Conforming loan limit won't fall with home prices

OFHEO scraps plan to require reductions

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In a reversal of past policy, federal regulators say they won’t lower the $417,000 conforming loan limit to keep it in line with falling home prices.

Adopting a stance taken by Fannie Mae and Freddie Mac during the housing downturn of the early 1990s, the Office of Federal Housing Enterprise Oversight has ruled that the conforming loan limit will move in only one direction: up.