The Federal Housing Administration looks poised to replace Fannie Mae and Freddie Mac as the primary government lender of relatively high-cost mortgages.
The government recently passed a bill that extended the agency's conforming loan limit to $729,750 in the country's most expensive neighborhoods, while keeping Fannie Mae and Freddie Mac's ceiling at $625,500, the level to which it fell after Congress allowed a previous $729,750 loan limit to expire on Oct. 1. This probably means that relatively well-off homebuyers will increasingly turn to the FHA in order to help finance mortgages in high-cost areas, concludes columnist Kenneth R. Harney.
The decision by Congress to raise loan limits solely for FHA-insured loans, and not for Fannie Mae or Freddie Mac-backed loans, reflects the government's growing displeasure with the two mortgage giants (which back roughly half of all mortgages in the U.S.) and its desire to reduce their role in the housing market.
The Latest from our Partners
- People Who Retire Comfortably Avoid These Financial Advisor Mistake…
- Ready to Withdraw from Your Retirement Accounts? Do it in This Order
- 2020: How to Maximize Your Savings
- $400K Refi in this Economy? 1.979% APR (15 yr)
- Experts urge Americans to refinance in 2021
- Little-Known VA Option Could Save Veterans Thousands
- Home Mortgage Rates Drop Sharply This Week
- HARP Refinance Program is Over. Now What?
- Digital Mortgage Platform Helps Home Buyers Shop for Mortgages
- 4 Cards With Massive Sign Up Bonuses (Get $200 Fast)
- Pay No Interest Until 2022 With A Better Credit Card
- Getting approved for 1 of these cards means you have excellent credit
- Forget the 30yr mortgage if you owe less than $726k (Do this instea…
- How to pay off your house ASAP (So simple it's unbelievable)
- Congress Gives Veterans A Generous Mortgage Relief Program