U.S. Senate votes to reinstate federal loan limits

The U.S. Senate voted this week to reinstated the Federal loan limits for mortgage loans guaranteed by Fannie Mae, Freddie Mac, and the Federal Housing Administration.  The higher loan limits expired September 30 and the new limits are an average of about 10 percent lower.

From South Carolina, Senator Lindsay Graham voted in favor of restoring the loan limits.  Senator Jim DeMint voted against restoring the loan limits.  The proposal now heads to the U.S. House for its consideration.

Bob Nielsen, chairman of the National Association of Home Builders (NAHB) and a home builder from Reno, Nev., issued the following statement regarding the Senate action to reinstate higher loan limits for Fannie Mae, Freddie Mac and the Federal Housing Administration that expired on Sept. 30:

"The National Association of Home Builders commends the Senate for approving an amendment offered by Sens. Bob Menendez (D-N.J.) and Johnny Isakson (R-Ga.) that is essential to help mend the struggling housing market, provide affordable mortgages for creditworthy home buyers and move the economy forward. The 60-to-38 vote demonstrates bipartisan support for pro-housing policies that will help our industry to create jobs and spur economic growth.

"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.

"Congress must act soon to ensure that this measure is enacted into law. Otherwise, the current drop in mortgage loan limits will reduce housing demand, and place downward pressure on home prices in major markets. This will exacerbate the current housing downturn, trigger more foreclosures, impede job growth and endanger the fragile economic recovery."