Military veterans will now be able to use their government benefits to purchase more expensive houses as a result of an increase in the limit on GI loans that are bundled into securities sold in the secondary mortgage market.Effective Jan. 1, Ginnie Mae, the federal agency that pools mortgages guaranteed by the Department of Veterans Affairs, raised the ceiling on loans eligible for pooling from $322,700 to $333,700. Borrowers seeking no-downpayment VA loans will still be limited to mortgages of no more than $240,000. But those who have some cash to put into the deal now will be able to borrow an amount up to the new Ginnie Mae limit. The change "will help mostly repeat buyers who have some equity from the sale of a previous residence," said Keith Pedigo, director of the VA's loan guaranty service. In fiscal 2003, the VA backed a record 490,000 loans totaling nearly $63 billion. In almost a third of those loans, borrowers used their GI home loan benefit for a second or third time. The vast majority of the country's 24 million veterans qualify for the housing entitlement.

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