Higher FHA limits should help

Thanks to the Economic Stimulus Act of 2008 that President Bush signed into law several weeks ago, the Federal Housing Administration (FHA) has temporarily increased its loan limits and can insure larger mortgages at more affordable rates in high cost areas of the country, HUD announced.
The new temporary loan limits, which range from $271,050 to $729,750, will give 240,000 more homeowners and buyers a safer, more affordable mortgage alternative for purchases and refinancing. The maximum amount of $729,750 will apply only to high-cost areas, such as New York, Los Angeles, San Francisco and Washington, D.C.

HUD also calculated new limits for Fannie Mae and Freddie Mac loans. FHA Commissioner/Assistant Secretary for Housing Brian Montgomery says, “Many families all over the U.S. will benefit from this access to credit, and increasing these loan limits will inject much-needed liquidity into the housing market.”