Recently Congress voted to restore the previously increased loan limits for Federal Housing Administration loans.  This is considered to be a major victory, as higher loan limits will make mortgages more accessible for hard-working, middle class families throughout the country.  This action reinstates the loan limit at 125 percent of the area median price up to $729,750 for 2 years, and extends the National Flood Insurance Program until later in December with no lapse.  There have been some mixed reviews regarding loan limit issues.  One argument made from the opposition is that only wealthy borrowers benefit from the maximum cost limits.  In 2010, the FHA was used by 56% of all first-time homebuyers, and 85% of borrowers obtaining homes at the higher loan limits had incomes below $150,000.  An important factor to consider when making that argument is to take the geograhpic area into consideration, as this often impacts what qualifies as "affordable housing".  This new loan limit will give equal opportunity to benefit consumers no matter where they choose to live.  Last year's statistics showed a decline in mortgages for higher priced homes, in spite of historically low interest rates.  The restoration of loan limits is definitely good news for homebuyers, especially in areas like Southern California. 

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