On February 13, 2008, President Bush signed the economic stimulus package into law. The economic stimulus package includes several important housing provisions, including increases in the loan limits for Fannie Mae and Freddie Mac (GSE) and also FHA.
The increase is for FHA loans that are approved on or before 12-31-2008.
$271,050 is the new FHA floor, based on 65% of Freddie Mac current limits. The previous floor was $200,160 based on 48% of Freddie Mac limits.
The new limits will be the lesser of: 125% of the Area Median Price; or
$729,750 which is 175% of 2008 Freddie Mac limits.
HUD has 30 days after enactment to define the Area Median Prices in the Country and publish the new loan limits.
This means that ALL FHA limits will be increased by something! The areas with low median prices will go to $271,050. The areas with high Area Median Prices can go as high as $729,750. But until we know what HUD will use for Area Median Prices, we won't know what any of the exact amounts are.
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