REALTORS® Applaud FHFA on Loan Limits
NAR President Steve Brown applauded an announcement by the Federal Housing Finance Agency that it won't consider lowering conforming loan limits until further notice. NAR had shared its opposition to lower loan limits when the agency earlier floated a proposal to reduce conforming loan limits for Fannie Mae and Freddie Mac this past summer. Lower loan limits, NAR told the agency, would increase costs for consumers and reduce their access to conventional mortgages, jeopardizing "homeownership for many creditworthy buyers."
The following is a statement by NAR President Steve Brown:
“REALTORS® welcome today’s announcement from the Federal Housing Finance Agency that the current limits on conforming loans will remain in effect until further notice. As the leading voice for homeownership, NAR opposes lowering the ceiling on loans eligible for backing by the government-sponsored enterprises. Lower loan limits would increase costs for consumers and reduce their access to conventional mortgages.
“In September, when reports surfaced that FHFA Acting Director Edward DeMarco was considering using conservator authority to lower loan limits, NAR cautioned that such an experiment would jeopardize homeownership for many creditworthy buyers, especially first-time home buyers who are often less likely to meet the 20 percent minimum down payment requirement.
“There is already enough turbulence in the regulatory environment for mortgage lending. In January 2014, many changes stemming from the Dodd-Frank Act will go into effect, including the ability-to-repay requirement. In addition, risk retention regulations remain in flux, including the definition of a Qualified Residential Mortgage. Lowering loan limits at this time would create even more confusion and uncertainty, and we would run the risk of reversing the progress that’s been made in the economic recovery.”
Click here for a list of conforming loan limits for specific counties.