Increased Loan Limits Take Effect in the Bay State
Administration’s (FHA) loan limits for 1-4 family homes in Boston and surrounding counties last week. The FHA loan limit will increase from $362,790 to $523,750 – or 125 percent of the area’s median selling price in Essex, Middlesex, Norfolk, Plymouth and Suffolk Counties.

The loans are not restricted to lower-income applicants and borrowers who pay a small insurance premium will be eligible for an interest rate almost as low as the best qualified home buyers.

Fannie Mae and Freddie Mac conforming loan limits have also increased. Single-family mortgages priced up to $523,750 will be available at lower interest rates than in the recent past when jumbo loans above $417,000 carried a higher interest rate. Importantly, the new higher Fannie and Freddie conforming loan limits are temporary and only apply to loans made between July 1, 2007 and December 31, 2008.

Loan limits for 2 and 3 family homes have also been increased in the five county Metro Boston region to $670,500 and $810,450 respectively. The new loan limits apply to FHA and Fannie Mae and Freddie Mac conforming loans.

So how do you communicate the benefits to your clients? To help you do so, the National Association of REALTORS® has launched a new web page – What Economic Stimulus Means for REALTORS® - devoted to educating you and your clients about the benefits of increased loan limits, loan eligibility and temporary loan increases.

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