If you were looking to borrow more than 417,000 in 2007 for your home, expect to pay the premium for a jumbo mortgage instead of a conventional mortgage. For the past few years, the amount you could borrow on a conventional mortgage has been rising rapidly.

Now with housing prices essentially unchanged, Fannie Mae and Freddie Mac have left the loan limit for a conventional mortgage unchanged from 2006 to 2007.

Fannie and Freddie announced plans yesterday to keep conforming loans’ cutoff at $417,000 for 2007, unchanged from 2006. That means home buyers who borrow more than $417,000 next year will need costlier “jumbo” loans.

Generally, jumbo-mortgage interest runs about 0.25 percentage points higher than conforming-loan rates. Borrow $417,001 at today’s jumbo rates and you’d pay $22,500 more interest over 30 years than you would if you could get the money at conforming rates.

“In years past, as the conforming-loan limit increased, borrowers had a cheaper mortgage alternative,” said Greg McBride, senior financial analyst with mortgage tracker Bank-Rate.com. “But next year, that alternative will be harder to grab a hold of.” By law, Fannie and Freddie adjust the conforming-loan limit each November based on how much average U.S. home prices changed in the preceding 12 months.

This year, prices rose just 0.16 percent, so Fannie and Freddie left the limit unchanged for 2007. via the BostonHerald.com

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