A Senate Appropriations subcommittee voted unanimously Tuesday to raise the ceiling on mortgages that can be insured under the FHA program.

The vote is a major breakthrough in the Clinton administration's drive to expand the Depression-era program in large metropolitan areas and extend its reach to more middle-class homebuyers.

The subcommittee agreed to raise the FHA loan ceiling to $197,490 in high-cost areas and to nearly $109,000 in lower-cost housing markets.

Though lower than the $227,150 nationwide loan limit sought by the administration, the new limits would substantially increase the current ceilings, which range from roughly $86,000 in low-cost areas to $170,000 in high-cost markets.

"We think it's a fair compromise right now, and we are going to be fully supportive," said Jerry Giovaniello, vice president, government affairs at the National Association of Realtors.

The Senate Appropriations Committee is to vote on the bill Thursday.

In the House, a vote by a comparable appropriations subcommittee is expected June 18. Panel chairman Jerry Lewis, R-Calif., supports the administration's higher limits. But the issue remains controversial, and many Republicans, including House Banking Committee Chairman Jim Leach of Iowa, oppose the increase. Groups such as the Mortgage Insurance Companies of America and Fannie Mae are also against the increase.

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