FHA mortgage limits were raised by President Obama to the former level meaning you can borrow as much as $729,750 when refinancing your home. That’s good news for homeowners with jumbo mortgage loans wanting to take advantage of today’s low refinance mortgage rates. Here’s an article on MortgageLoan.com explaining the changes and what it all means for you:
Legislation restoring the former limits was passed by Congress on Thursday and was signed into law by President Obama today. The maximum FHA loan limit had fallen to the old maximum of $625,500 on Oct. 1, when a previous extension of the higher limits expired. The action, which advocates said was needed to maintain support for the housing market during a time of economic stress, also raises lesser FHA mortgage limits in many areas where the $729,750 does not apply.
This is good news for a lot of homeowners; however, there’s always a catch. If your home loan is backed by Fannie Mae or Freddie Mac the change does not apply. The standard loan limit still applies for Fannie and Freddie of $417,000. You can use an FHA mortgage to refinance your existing home loan even if your current loan isn’t under the FHA. Existing homeowners may be eligible for a FHA streamline refinance which does not consider your loan-to-value ratio or income.
Remember not to overlook fees when refinancing your home. Many homeowners make the mistake of focusing on getting the lowest refinance mortgage rates from lenders like Amerisave at the expense of fees. Overpaying closing costs that include lender junk fees can make it difficult, even impossible to recoup your out-of-pocket expenses, negating any benefit you’ll get from mortgage refinancing.
You can learn more about getting today’s lowest refinance mortgage rates without paying junk fees by checking out my free Underground Mortgage Videos.