FHFA acting director Edward DeMarco says he wants to delay the loan limit reduction because so many new mortgage and servicing rules go into effect in January.
DeMarco has not indicated the amount of the loan limit adjustment but sources are betting the top rate will be reduced to $600,000.
In a speech Thursday, the GSE regulator said he will reveal the changes in November. He also indicated Fannie and Freddie’s $417,000 base limit (or national conforming limit) will be reduced.
“Any reduction would be across the board, not just in some parts of the country,” he said. The national conforming loan limit is expected to be cut to $400,000. But the FHFA has not confirmed that either.
Separately, the Federal Housing Administration is expected to announce annual adjustments to its loan limits in November. FHA’s statutory authority to endorse loans with balances up to $729,750 expires at the end of this year. And Congress is not going to renew it. On Jan. 1, the maximum FHA loan limit will be $625,500.