FHA borrowers may again see expanded loan limits

The following is an excerpt from the weekly newsletter from HSH associates:

“FHA borrowers may again see expanded loan limits. Congress attached a provision doing so to a bill that President Obama is expected to sign into law before long. This comes on the heels of a report questioning the solvency of the FHA insurance program and the possibility that the fund may need a taxpayer bailout in the next two years. The limits were only reduced a few short weeks ago, and there is little evidence that lower limits have caused any trouble in the housing market so far. However, some factions feel that the housing market cannot do without wide-open and near-perpetual support, even if that includes continuing to allow borrowers to obtain up to $729,750 with as little as 3.5% down and lower credit scores.”