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What's Hot!
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As
of August 28, 2003, HUD updated the FHA S/F mortgage limits in a number of localities.
These changes are in accordance with OMB
Bulletin 03-04, dated June 6, 2003. OMB designated 49 new Metropolitan Statistical
Areas (MSA) and Partial Metropolitan Statistical Areas (PMSAs). Read HUD Mortgagee
Letter 2003-12 for More...
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FHA 2008 Mortgage Limits Published: Read
FHA Mortgagee Letter 2008-06
for the full details.
Effective
March 6, 2008, HUD will offer temporary FHA loan limits that will range from $271,050
to $729,750 (Limits). Overall, the change in loan limits will help provide economic
stability to America's communities and give nearly 240,000 additional homeowners
and homebuyers a safer, more affordable mortgage alternative. The maximum amount
of $729,750 will only be applicable to extremely high-cost metropolitan areas.
Previously, FHA's loan limits in these very high-cost areas were capped at $362,790.
The Economic Stimulus Act of 2008 permits FHA to insure loans on amounts up to
125 percent of the area median house price, when that amount is between the national
minimum ($271,050) and maximum ($729,750). The new minimum and maximum loan limits
are based on 65 percent and 175 percent of the conforming loan limits for Government-Sponsored
Enterprises in 2008, which is $417,000. The FHA used a combination of existing
government data sets and available commercial information to determine the median
sales price for each area. The change in loan limits are applicable to all FHA-insured
mortgage loans endorsed with HUD’s publication of the increased loan limits on
March 6, 2008, and it lasts until December 31, 2008.
By increasing loan
limits nationwide, FHA will provide much needed liquidity and stability to housing
markets across the country. Already, as conventional sources of mortgage credit
have been contracting, FHA has been filling the void. From September to December
2007, FHA facilitated more than $38 billion of much-needed mortgage activity in
the housing market, more than $15 billion of which was through FHASecure, FHA's
refinancing product. By focusing on 30-year fixed rate mortgages, FHA helps homeowners
avoid and escape the risks associated with exotic subprime mortgage products,
which have resulted in rising default and foreclosure rates.
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