Last week, the U.S. Congress passed a “minibus” appropriations measure that will continue to fund the government and includes a provision to reinstate the FHA loan limit in high-cost areas for two years. President Obama signed the measure into law Friday.
The higher Fannie Mae, Freddie Mac, and FHA conforming loan limits of $729,750 expired Oct. 1, when it was reduced to $625,500. The passage of H.R. 2112 provides for an extension of FHA-insured mortgages at the higher level through December 2013. It also provides for a short-term extension of the National Flood Insurance Program (NFIP) through Dec. 16, 2011. C.A.R. and NAR strongly urge Congress to work on a five-year NFIP reauthorization bill to provide certainty and avoid further disruption to real estate markets.
“C.A.R. is pleased the Senate and House were able to come to a reasonable compromise on extending the FHA loan limit to ensure affordable home financing for middle-class buyers,” said 2012 C.A.R. President LeFrancis Arnold. “However, we are disappointed that the Senate and House could not agree on increasing the loan limits for Fannie Mae and Freddie Mac, especially since the Senate bill included a premium on high-cost loans that protected U.S. taxpayers from footing the costs.”
C.A.R. and the NAR have long advocated making permanent higher loan limits.
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