New FHA Loan Limit for Orange County CA.

As stipulated in the newly passed Economic Stimulus Bill of 2008, FHA announced the  new loan limits for Orange County, CA.  This new FHA loan limit is based on a calculation of 125% times the median price, up to a maximum of $729,750.  Since the median price in Orange County is around $600,000, the new FHA loan limit for Orange County is the maximum allowed.  Below is a table of the loan limits for single family homes, as well as small multi-family housing:  

HUD Secretary, Alphonso Jackson recently announced the new limit increase at the Anaheim Convention Center where HOPE NOW was conducting a national anti-foreclosure campaign. This new $729,750 limit will double the previous FHA loan limit of $362,790, the U.S. Department of Housing and Urban Development (HUD) announced. This limit is good until the end of the year when it reverts back to $362,790, but some feel this deadline will be extended into 2009′.  This new bill will allow FHA to refinance of up to 97% loan to value, but most mortgage lenders will only go up to only 90% loan to value.

This new FHA loan limit will enable many Orange County homeowners to refinance out of their expensive adjustable rate mortgages, even if their property has has gone done in value over the past few years.  Also, the new FHA loan program will allow some homeowners with adjustable rate mortgages to refinance if they are behind on payments.

Another great benefit for Orange County would be home purchasers, is that FHA is much more forgiving of a few negative marks in ones FICO credit rating. in the past 12 months, Conventional lenders have become much more demanding on credit quality. New FHA underwriting will also allow for more flexible income documentation and less time on a given job.

This new FHA loan limits for orange County plus more flexible qualification standards could be a big boost for the slumping Orange County housing market.  Many Orange county residents depend on jumbo loans, anything above the current $417,000 limit. Interest Rates on jumbo loans are more expensive, ten conforming loans (ie: loans below $417,000).  The average rate tis past week for a 30-year fixed conforming loan in Orange County was 5.9 percent with a one-point fee, while the average jumbo rate on a 30-year fixed was 6.9 percent with a one-point fee.

If you would like more information on the new FHA loan limits, or would like a referral to a couple of great local FHA lenders, feel free to call us at: (949) 388-3396, or send us an email at:  Info@OCRealtyGroup.com   We specialize in Short Sale workouts for Orange County homeowner in need.  If you would like to learn more about Short Sale workouts, visit our website at:  www.OCShortSaleCenter.com