Friday President Barack Obama signed a bill that reinstates the recently expired higher loan limits that were in effect for FHA and VA loans through December 31, 2013 but does not provide this extension to Freddie Mac and Fannie Mae.

 

According to the article on Mortgage News Daily, “The new legislation also sets an annual fee for loans guaranteed by Freddie Mac and Fannie Mae. This fee is in the amount of 15 basis points on the outstanding principal balance of the loan and is "independent of any guarantee fees upfront on ongoing, charged to the borrower, and the premium loan fee shall not be affected by changes in guarantee fees." The fee, according to the bill, is expected to achieve an annual income of $300 million in revenue which "shall be used to pay for costs associated with maintaining loan limits established under this section. “

 

This is great news for homebuyers who are refinancing or purchasing a home with FHA financing! Feel free to contact The Werdmuller Group for any questions on the housing and finance markets at info@garrick.biz or 510.282.5456.

 

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