Stimulus Bill Could Raise Limits on FHA Loans
Posted on 10 February 2009 by Jamie Beck
A version of the stimulus bill currently making its way through Congress proposes to increase the limits on FHA loans.
Inman News reports:
“The House version of the bill would restore the upper limits for Fannie Mae, Freddie Mac and FHA loan guarantee programs to $729,750 in high-cost housing markets, where they stood for much of 2008 before being reduced to $625,500 — a step endorsed by many real estate industry groups.”
There’s no guarantee that this provision will appear in the final legislation. But, if it does, homeowners living in higher cost of living areas (such as Los Angeles, San Francisco, and New York) will have the ability to buy more expensive properties with the benefits of an FHA loan. In most areas throughout the country, $729,750 would get you a pretty amazing mansion. But, in big cities like those listed previously, homeowners pay about that much for a nice, 3br/2ba home in a good neighborhood.
FHA-insured loans allow homeowners to buy with a low down payment (3%) and minimal closing costs.
photo credit: ktylerconk
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Tags | FHA, legislation, low downpayment loans, mortgages