The Department of Housing and Urban Development said Monday that mortgages of up to $625,500 in high-cost areas will be eligible for insurance through the Federal Housing Administration beginning Jan. 1.
The economic stimulus package passed by Congress this year gave the FHA the power to insure loans of up to $729,750 through yearend. Though the new limit is lower, it still tops the $362,790 cap that was in effect before the stimulus legislation.
The limit in regions that are not considered high-cost ones will be $271,050. The previous limit there was $200,160.
The Federal Housing Finance Agency said last week that Fannie Mae and Freddie Mac may purchase loans up to $625,500 in high-cost areas. The government-sponsored enterprises may buy mortgages of up to $417,000 in other areas.
