The Federal Housing Administrations (FHA) limits the loan amount on mortgage loans they insure and that number is about to change. The loan limit is based on a set formula and range of values of the median home price in a particular area. For the Portland Metro area that limit is currently $418,750.  This is called the “conforming” loan amount.

Unless the current congress takes action to prevent it, the FHA loan limits will revert on October 1st to those limits that were determined by prior legislative action. This means that the new loan limits will be dropping to $362,250. Any mortgage of a greater amount will then qualify under the jumbo-loan category, a more costly and restrictive program.

If you are planning to close a home purchase loan or a re-financing loan prior or near to October 1st you must pay attention to your loan amount to be sure you avoid the added expense or credit restrictions of the new program.

Please contact one of us at The Jackson Group or your personal loan officer if you are in this situation. We hope that the current congress will see fit to extend the present program rather than put more pressure on the residential housing market. And to be safe, we are notifying all our clients to be prepared and close on time for any current loans in application.