WASHINGTON - The House and Senate have passed bills that would raise the limits on multifamily housing loans eligible for the Department of Housing and Urban Development's FHA insurance program in order to meet rising construction and real estate costs.
The two bills, which were introduced by Democratic Sen. Jon S. Corzine and Republican Rep. Marge Roukema, both of New Jersey, are similar to each other, but they will have to go through a conference committee after Congress reconvenes next month because they were part of larger housing/veterans spending bills.
The Senate adopted the package on Aug. 2, and the House on July 30.
The legislation would immediately raise by 25% the limits on loans that can be insured under the FHA program. Future hikes would then be tied to increases in building costs.
"For too many teachers, nurses, and police officers, the struggle to gain access to affordable housing today is insurmountable," Sen. Corzine said in a press statement when he introduced his bill July 11.
The Census Bureau estimates that more than 711,000 moderate-income families critically need rental housing, and the Center for Housing Policy found that almost 14 million families either live in substandard housing or spend more than half of their monthly income on housing, according to the statement.
To qualify for FHA loan insurance, borrowers must set aside a certain number of units for low- or moderate-income residents.
