Today, the Federal Housing Finance Board announced the results of its Monthly Interest Rate Survey for October, 2001. This survey includes the average one house sales price for October, which is the statutory index for calculating the Fannie Mae/Freddie Mac conforming loan limits for 2002. The October 2001 one house price is $219,600, up 9.36% from last year’s $200,800. Accordingly, using the statutory formula, the 2002 Fannie Mae/Freddie Mac conforming loan limits will be:

Under the Freddie Mac and Fannie Mae Charter Acts, the conforming loan limits for Alaska, Hawaii, Guam and the Virgin Islands will be 50% higher than those listed above.

The 2002 FHA loan limits are established based upon a percentage of the Fannie Mae/Freddie Mac conforming limits. The FHA "floor" loan limits are set at 48% of the conforming limits. Accordingly, the new floor loan limits for FHA will be:

The FHA "ceiling" loan limits for high cost areas are set at 87% of the conforming limits. Accordingly, the new high cost ceiling limits for FHA will be:

Please be cautioned that all the areas at the current maximum FHA high cost limit of $239,250 will not automatically go to the new maximum of $261,609. FHA uses its own internal data to determine the new loan limits for the various high cost areas and we will not know the specific limits for each high cost area until they are published in a Mortgagee Letter. In addition, in Alaska, Hawaii, Guam and the Virgin Islands, FHA may establish loan limits as much as 50% higher than the high cost limits stated above.

FHA expects to publish a Mortgagee Letter with a complete listing of all areas with high cost limits by the end of December.

The VA loan limit is set independently of the conforming limits and remains at its current level.

If you have any questions concerning the new loan limits, please contact Bud Carter here at MBA at 202-557-2859.