Congress approves increased mortgage loan limits

Congress gave overwhelming final approval on 2/7/08 to the Economic Stimulus Package supported by NAR and Realtors across the country. As a result, the government will be sending payments to most American households and grant tax incentives for business investment The plan totals $152 billion. The final deal came yesterday after the Senate added low-income seniors and disabled veterans to the list of people who would receive money under a package previously approved by the House, then approved the bill, 81 to 16.
The House took up and passed the Senate measure last night in a 380 to 34 vote, ensuring that checks would begin reaching eligible recipients by mid-May.
In a nod to the housing problems, the stimulus plan will increase the limits on home loans that can be purchased by Fannie Mae and Freddie Mac, the government-sponsored finance companies, and on loans that can be insured by the Federal Housing administration. The one-year increases will make it easier to refinance loans or obtain new mortgages in expensive markets. The new limits will vary based on local conditions. The increased loan limits means borrowers will see immediate relief with new liquidity in the mortgage market and the nation will see an additional 300,000 home sales. The increased FHA loan limits means an additional 138,000 Americans will purchase homes, and with the needed FHA reforms means 200,000 families can refinance their homes safely and affordably. (info from NAR and The NY Times)