Industry Wants GSE Loan Cap Extended

Realtors, homebuilders and mortgage bankers are asking Congress to extend and make permanent, before year-end, the $729,750 maximum loan limit for Fannie Mae, Freddie Mac and Federal Housing Administration loans. Congress increased the loan limits in high-cost markets back in February as part of a stimulus bill to revive lending in the jumbo loan market. The increase, though, expires on Dec. 31. Without an extension, the loan limit will fall to $625,500 on Jan. 1. "Specifically, we ask that Congress eliminate the forthcoming decreased limit for high cost areas," the Mortgage Bankers Association said in a Nov. 13 letter to House and Senate leaders. MBA also wants Congress to increase the conforming loan limit from $417,000 to $625,000 to provide a "broader range of secondary market support.