Democrats Seeking To Extend Fannie, Freddie Loan Limits
October 27 2009 - 7:35PM
Dow Jones News
U.S. House and Senate lawmakers are proposing to extend
temporary higher limits on the size of home mortgages Fannie Mae
(FNM) and Freddie Mac (FRE) can buy or guarantee as part of a
stopgap funding legislation that could pass Congress as soon as
this week.
The legislation, known as a continuing resolution, would fund
the federal government through Dec. 18 at 2009 levels, giving
lawmakers more time to complete appropriations measures. Language
in the bill would also extend the loan limits, which are set to
expire Dec. 31, through the end of next year, the top Democratic
appropriators, Sen. Daniel Inouye of Hawaii and Rep. David Obey of
Wisconsin, said in a press release late Tuesday.
The legislation would also extend temporary higher limits on the
size of mortgages the Federal Housing Administration could
insure.
The housing industry has grown anxious about the looming
expiration of the higher loan limits, which they argue are
necessary to sustain a housing recovery. Rates on mortgages that
Fannie and Freddie can buy - known as "conforming" loans -
typically are lower than on other larger mortgages. The loan limits
were lifted to nearly $730,000 from $625,500 by economic stimulus
legislation passed early in the year.
The continuing resolution still must pass both houses of
Congress.
-By Jessica Holzer, Dow Jones Newswires; 202-862-9228;
Jessica.holzer@dowjones.com