Increased Federal Loan Limits Lower Price Tag on Hundreds of Thousands of Loans

This may be old news - but in case you didn't know!

One immediate benefit of The Economic Stimulus Act of 2008 is the increase in loan limits for high-cost areas of the country. By raising the Federal Housing Administration’s loan limits on what qualifies for lower-cost FHA, Fannie Mae and Freddie Mac loans, the bill could help a quarter of a million families purchase or refinance their homes at a lower cost. Combined with record low interest rates, the change could improve the financial picture for many now facing foreclosure. The options and loan ceilings vary, however, from county to county and only a Certified Mortgage Planner can weigh all the options to determine if a new loan makes sense for an individual homeowner.

The increase is only temporary, however, so homeowners looking to shed the premium they pay for subprime or jumbo loans required to live in their state need to act quickly to take advantage of these federally-guaranteed loans.

FHA loan limits that will range from $271,050 to $729,750 with the largest loans available in high-cost metropolitan areas such as New York, Los Angeles, San Francisco and Washington, D.C. But even smaller markets could see increased activity in the housing market when the new loans become available.