Real estate professionals who have been speaking out against the recent decrease in conforming loan limits for government-backed home loans won a small victory in the Senate this month.
Beginning October 1, the conforming loan limit for loans backed by lending giants Fannie Mae and Freddie Mac and the Federal Housing Administration decreased to $625,500. New legislation that is being offered as part of a federal spending bill proposes to increase the loan limits in high-cost areas more permanently to $729,750. Senate lawmakers passed the measure after a 60-38 vote.
While the measure is expected to meet with some resistance in the House of Representatives, its supporters insist that the legislation will help to relieve some of the pressure currently stalling progress on the real estate market. However, the bill’s opponents claim that high[er]-end homebuyers should not require government assistance to buy their homes.
Many in the real estate business reacted to the Senate action, including National Association of Home Builders chairman Bob Nielson.
“Restoring the higher loan limits for the housing government sponsored enterprise and the FHA will provide home owners and home buyers with safe and affordable financing while providing a much-needed boost to housing markets all around the country,” Nielson said in a statement.