FHFA Publishes New Loan Limit Tables

The Federal Housing Finance Agency (FHFA), acting as the government-sponsored enterprises' regulator, has released ‘lookup tables’ that provide information about local areas' new maximum conforming loan limits, which were increased by the recently enacted American Recovery and Reinvestment Act (ARRA).

In 250 counties, Fannie Mae and Freddie Mac loan limits will return to their late-2008 levels, which were up to $729,750 for one-unit properties in the continental U.S. Loan limits in other areas are not changed by the legislation.

Conforming loan limits for 2009 were originally announced in late 2008 and had been calculated under terms set forth in the Housing and Economic Recovery Act of 2008 (HERA), passed last July. The new ARRA legislation stipulates that, for loans originated in 2009, the loan limit is to be the higher of the 2008 limits and those originally calculated for 2009 under HERA. Where the 2008 and 2009 limits differ, the 2008 limits tend to be higher, and thus, in most cases, loan limits are reverting back to last year's levels, the FHFA says.

For the relatively few counties where 2009 limits actually increased (43 counties in Virginia, North
Carolina and California), the new limits will remain at the higher level.

The FHFA notes that, under the ARRA, the agency's director is given the authority to increase loan limits levels for "subareas." Given the implementation difficulties associated with establishing multiple limits for any given county, Director James Lockhart currently has no plans to use this discretion.

The loan limits established under ARRA apply to all loans originated in 2009. For loans purchased in 2009 that were originated from July 1, 2007, through Dec. 31, 2008, the same limits will apply. For loans purchased in 2009, but originated before July 1, 2007, the limits previously announced by FHFA on Nov. 7 , 2008, and updated in December will apply.

Mortgage professionals can reference the FHFA's lookup tables at www.ofheo.gov.



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