New FHA, Fannie Mae and Freddie Mac Loan Limits

My Dear Clients and Blog Readers: Further information is provided by Dick Gaylord, 2008 NAR President.

I know I have been mentioned this news before. Here it is some relief to our current market conditions, and it arrived today: the new FHA and Fannie Mae- Freddie Mac conforming loan limits have been released by the U.S. Department of Housing and Urban Development.

To find out the new limits in your area, simply click on this link: http://go-to.realtor.org/r/3OS1G5/C5JMU/ZB4YT4/DKPVD/J9A5D/B7/h, which will take you to the "mortgage limits" page at the HUD web site. On that page, enter your state and county information, chose the type of loan from the "Limit Type" drop-down box (FHA Forward, Fannie/Freddie or HECM). [Note: FHA Forward is what HUD is calling the temporary FHA loan limit.] Then click the "send" button at the bottom of the page. On the results page, you'll see the new loan limit for the type of loan you selected for your area.

You can also find a county-by-county listing of the new FHA and Fannie Mae-Freddie Mac loan limits at REALTOR.org by following this link: http://www.realtor.org/GAPublic.nsf/files/chart_hud_loan_limits_08.pdf/$FILE/chart_hud_loan_limits_08.pdf

The new loan limits for FHA and Fannie Mae and Freddie Mac are now calculated at 125 percent of the HUD published median prices, with a floor of $271,050 and $417,000, respectively, not to exceed $729,750.

Association is Realtors expect the impact of these loan limit increases on the housing market to be significant because of the infusion of capital into the mortgage market, which should result in lower interest rates across the board. In addition, there will be a direct impact on high-cost areas that previously required borrowers to take out costlier jumbo mortgages.

As NAR research points out, increasing FHA loan limits will help an additional 138,000 Americans achieve the dream of home ownership and will allow nearly 200,000 homeowners to refinance and potentially keep their home. In addition, NAR believes that increasing the loan limits for Fannie Mae and Freddie Mac will bolster the housing finance market, which continues to be severely stressed, by providing an immediate infusion of much needed liquidity to the mortgage market.

An economic impact study conducted by NAR in January 2008 estimated that increasing the GSE conforming loan limits would result in as many as 500,000 refinanced loans and could help reduce foreclosures by as much as 210,000. In addition, over 300,000 additional home sales could be generated, housing inventory would be reduced and home prices would be strengthened by two to three percentage points.


HUD was mandated in the Economic Stimulus Act to publish new loan limits within 30 days of the bill's signing by President Bush on February 13. NAR strongly supported this economic stimulus package because of the relief we felt it would bring our members.