Higher Jumbo Loan Limits Should Expire says HUD Secretary

NewImageWhile many in the reverse mortgage industry are hoping for the higher loan limits to be extended, Department of Housing and Urban Development Secretary Shaun Donovan told Bloomberg Television the limits can return to pre-crisis levels without hurting the housing market.

“We continue to be convinced that this is the right step to take now and that it’s not going to have a major impact on the market going forward,” Donovan said during the interview.

HUD has repeatedly said the future loan limits for the Federal Housing Administration’s reverse mortgagee program are up in the air.

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“The loan limits were raised because of the crisis. We have to go back, and we have to get started on that,” Donovan said.

Donovan said the housing crisis is the worst the country has ever seen. He said government efforts to stabilize home prices have helped, but not enough.

Some members of Congress do not agree that the loan limits should be lowered.  Earlier this month, Rep. John Campbell (R-Calif.) and Rep. Gary Ackerman (D-N.Y.) introduced a bill to extend the current conforming loan limits for two years.

Barney Frank recently said that he believes the Obama administration will support keeping the loan limits where they’re at now. He also told the WSJ he believes many House Republicans will support doing so, given current housing market concerns.

“I think there’s a very real chance they’ll get extended,” Rep. Frank told the WSJ.

Higher Jumbo Mortgage Limits Should Expire On Schedule, HUD’s Donovan Says

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  • HUD needs to rescind the concepts created in Mortgagee Letters 2008-35 and 2008-36 and implement the maximum HECM lending limits allowed under HERA as enacted. 

    It is and has been a hoax that HERA created a single national lending limit.  Mortgagee Letter 2009-11 created a single national lending limit, not any law.
     
    The Federal Housing Finance Agency has correctly implemented the maximum applicable limits under 12 USC 1454(a)(2) for Freddie Mac.  It is time the Federal Housing Administration does the same for HECMs.
     
    It is time the charade ends and we get down to the rules Congress provided in HERA.  Both Freddie Mac and HECMs are governered by the same lending limits.
     
     

  • HUD needs to rescind the concepts created in Mortgagee Letters 2008-35 and 2008-36 and implement the maximum HECM lending limits allowed under HERA as enacted. 

    It is and has been a hoax that HERA created a single national lending limit.  Mortgagee Letter 2009-11 created a single national lending limit, not any law.
     
    The Federal Housing Finance Agency has correctly implemented the maximum applicable limits under 12 USC 1454(a)(2) for Freddie Mac.  It is time the Federal Housing Administration does the same for HECMs.
     
    It is time the charade ends and we get down to the rules Congress provided in HERA.  Both Freddie Mac and HECMs are governered by the same lending limits.
     
     

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