FHA Loan Limits Increased!

HUD announced today that the loan limits have been increased thru the end of the year. In Bexar and Comal County, the limit was raised from $200,000 to $332,500. In lieu of the extreme pressure on the mortgage industry due to the high delinquency rate of subprime loans (leading to high foreclosure numbers as well), this announcement should offer a much needed boost to the real estate market. While this is only thru the end of the year, it is anticipated that Congress may permanently raise these limits.

The FHA program gives potential homebuyers many advantages, including the following: low cash investment (3% down payment), not credit score driven (allowing for less stringent credit requirements), extremely competitive interest rates, and now limits high enough to provide more choice in home sizes, locations, neighborhoods, and potentially higher quality construction and features. This move will obviously see an increase in FHA home loans and home sales, taking up some of the slack left by the disappearance of the subprime market.

In addition to this news, FHA also allows for seller funded down payment assistance programs, giving buyers an even greater opportunity to buy a home with little or no down payment, interest rates that are as competitive as any in the market, and relaxed credit requirements. Between now and the end of the year, Buyers have the ability and the chance to buy more house than in the past. We also have more inventory to choose from because of the slowdown in the market which gives buyers more leverage in negotiating a more attractive price.

With all that FHA has to offer, with the condition of the current market, and with interest rates as low as they are, it is hard to come up with a reason not to buy a home AT THIS TIME! If we can answer any specific questions, please let us know.