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John Reinhardt Greater Atlanta & Surrounding Suburbs' Blog

By John J. Reinhardt | Agent in Johns Creek, GA

Unless Congress Acts quickly end of September maximum loan limits in many areas will decrease for FHA, VA and conventional

Special Alert. Unless Congress Acts quickly, at the end of September the maximum loan limits in many areas will decrease for FHA, VA and conventional conforming loans. This means that it may be more difficult for some buyers to qualify and some may have to pay higher rates. If you are thinking about refinancing or purchasing, we would advise you to check with us so that we can identify whether you are in an area that is likely to be affected and you can act expeditiously.
The Obama administration is considering a plan that would take foreclosed homes off the market and rent them out–in a move aimed at clearing the glut of unsold foreclosed homes and preventing home values from falling any more, The Wall Street Journal reports. The talks come at a time when national rents are on the rise and home prices have been falling. By taking advantage of these higher rents, lenders would be able to cover the costs of holding the properties until the homes can be resold once the market stabilizes, and maybe even make a profit on it later, experts note. Nationally, sales of distressed homes, which are often sold at steep discounts, continue to pull down home values. Removing some of the high number of foreclosed homes for sale is “worth looking at,” Federal Reserve Chairman Ben Bernanke said last week in testimony to Congress. Just reducing Fannie Mae and Freddie Mac’s foreclosed property sales from its current rate of 50,000 each month to 30,000 could lessen total distressed sales by one-third and help avoid a further 3 percent to 5 percent decline in home prices, analysts at Credit S uisse estimate. However, turning foreclosed homes into rentals could place lenders and the government in an unknown role of playing landlord. Another idea being tossed around, according to The Wall Street Journal: Federal officials selling thousands of foreclosed properties to private investors who would agree to rent them out, and who could then work with property management firms and handle the day-to-day tenant demands. Source: The Wall Street Journal



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