Today I received an email from the National Association of Realtors Realtor Action Committee stating that Congress restored the loan limits for FHA. Realtors have been working hard to help preserve this right and finally our hard work has paid off. This is a big step towards our real estate market recovery. Below is the full letter I received.
"Last night Congress restored the loan limits for the Federal Housing Administration (FHA) for two years.
As you know, in late September the FHA, Fannie Mae; and Freddie Mac loan limits were reduced in 42 states pricing potential home buyers out of the American Dream of home ownership and holding back the housing recovery.
NAR immediately went to work with the goal to get the loan limits restored in Congress. For weeks that goal seemed unlikely.
You, and countless other REALTORS® like you along with YOUR leadership and YOUR management team worked to educate Congress that well-qualified buyers didn't need yet another hurdle to access affordable mortgage financing.
They finally listened. Because we were persistent. And because we were right.
The reinstated FHA loan limit formula and cap change will help make mortgages more affordable and accessible for hard-working, middle-class families in 669 counties in 42 states and territories, where the average loan limit reduction after the reset last month was more than $68,000. The provision reinstates the FHA loan limits through 2013 at 125 percent of local area median home prices, up to a maximum of $729,750 in the highest cost markets, the floor will remain at $271,050. However, Congress chose not to apply the loan limits restoration to Fannie Mae and Freddie Mac. Fannie-and-Freddie-backed mortgages will remain at 115 percent of local area median home prices up to $625,500.
The bill also provides for a short-term extension of the National Flood Insurance Program through December 16, 2011. NAR will continue to press Congress to use the additional time to complete their work on a five-year reauthorization of the program, which ensures access to affordable flood insurance for millions of home and business owners across the country.
I know that when we work together we can accomplish anything we set our minds to in order to preserve, protect and defend the American Dream of Home Ownership."