The National Association of Realtors is warning that homebuyers are already being pushed out of the market because of a recent drop in the maximum size of government-backed home loans, the Wall Street Journal reported.
The reduced limits — $625,500 in expensive markets such as New York, down from $729,75 before October– went into effect early this month and are impacting loans guaranteed by Fannie Mae, Freddie Mac and the Federal Housing Administration.
NAR surveyed 1,300 real estate agents on the subject and discovered that about half said they represented buyers whose search for a home had been hindered by the reduced limits.
“All year we’ve been discussing the fact that many creditworthy home buyers are being denied mortgages,” said Ron Phipps, president of NAR. “We need to remove the roadblocks to a housing recovery — not place more obstacles in the way of financially qualified buyers.” [WSJ]