MBA Letter Cites Concerns over Potential Conforming Loan Limit Action

Julie C. Nichols General

MBA NewsLink – Mike Sorohan

The Mortgage Bankers Association expressed concerns Friday over recent reports that Federal Housing Finance Agency might reduce conforming loan limits for Fannie Mae and Freddie Mac, saying a reduction would be “disruptive” to the economy and the housing recovery. The letter to FHFA Acting Director Edward DeMarco said a potential reduction, combined with regulatory changes taking place in January, could combine to tighten credit and have a “significant impact” on thousands of families.

“As we have discussed previously, a reduction in loan limits at this time would be disruptive to the ongoing housing recovery and the economy as a whole,” wrote MBA President and CEO David Stevens. “While the housing market has improved in many areas of the country, the recovery remains fragile and uneven. Many potential homeowners remain on the sidelines unable to purchase a home or refinance their mortgage due to persistently restrictive credit standards resulting from regulatory and market uncertainty.”

>> Read more: http://www.mortgagebankers.org/tools/FullStory.aspx?ArticleId=42611#full