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New Stimulus Package: Part II – FHA, Freddie, & Fannie Loan Limits

March 2, 2009 by  
Filed under Featured, Finance, National

The bill regarding FHA, Fannie Mae, and Freddie Mac loan limits has extended its expiration to December 31st, 2009 and increased limits to 125 percent of a local market’s median home price.  In King County, the $417,000 loan limit for FHA has been reported to increase to $567,500 and the GSE loan limit to $567,500.

California had the only three metro regions where the loan limits reached their cap of $729,759.

This provision should lower the cost of home buying or refinancing since it’s favored by investors, but it could be argued that raising the limits just inflates home prices even further–hurting the GSE mission of bringing affordable housing to low- middle -income families.

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