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HUD # 05-WA-20
Pamela Negri
(206) 220-5356
http://www.hud.gov/washington
For Release
Monday
October 24, 2005

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HUD RAISES FHA MORTGAGE INSURANCE LIMITS
Residents in Seven Western Washington Counties to Benefit

SEATTLE – More homebuyers in seven western Washington counties may qualify for FHA insured mortgages and home improvement loans under new mortgage limits released October 19 by the U.S. Department of Housing and Urban Development. The limits were increased in King, Snohomish, Kitsap, Mason, Skagit, Thurston and Whatcom counties in response to rising home prices.

The new mortgage limits for a single–family residence are:
COUNTY NEW LIMIT OLD LIMIT LAST INCREASE
King $312,895 $305,900 6/16/2005
Snohomish $312,895 $305,900 6/16/2005
Kitsap $241,950 $215,650 6/16/2005
Mason $185,250 $172,632 1/1/2005
Skagit $214,000 $194,750 1/1/2005
Thurston $213,750 $194,650 6/16/2005
Whatcom $245,600 $202,113 1/1/2005
Higher limits apply for duplexes, triplexes, and fourplexes.

"We're pleased that FHA has made these changes," said John W. Meyers, HUD's Regional Director. "These new limits will help more people purchase or refinance homes using FHA insured loans. The higher limits benefit senior citizens seeking reverse mortgages as well."

FHA insured loans can be used to purchase or refinance one to four-unit homes, condos and manufactured homes. Many homebuyers are attracted to FHA-insured loans because of the program's benefits: a three-percent down payment, which can be 100 percent gifted from an acceptable source, liberal underwriting criteria, market rate interest, and consumer protections. FHA loans are not restricted to first-time homebuyers.

Also, under a special mortgage program, called Section 203(h), FHA will insure mortgages with zero downpayment for individuals or families in a Presidentially-declared disaster area whose residences were destroyed or damaged to such an extent that reconstruction or replacement is necessary. Victims of Hurricane Katrina or Rita can use this program to purchase a home anywhere they wish in the United States.

The increases will also benefit senior citizens who qualify for FHA-insured reverse mortgages. Reverse mortgages allow homeowners age 62 and older to borrow against the value of their homes without selling them. Homeowners can select a lump-sum payment, monthly payments or tap into a line of credit. No repayment is required as long as a homeowner lives in a home with a reverse mortgage. The reverse mortgage is repaid, with interest, when a homeowner sells the home or dies.

Native Americans choosing to use HUD's Section 184 Indian housing guaranteed loan program, which is available throughout most of Washington, will benefit as well because the loan limit for this program is 150 percent of the FHA mortgage insurance limit. Members of any federally recognized tribe could use the 184-loan program to purchase a home on or off reservation or trust lands. For more information go to: www.hud.gov/local/wa/community/indiansec184prog.cfm

The new loan limits are part of a regular adjustment HUD makes to account for rising home prices. The higher FHA loan limits will not cost the government because the FHA Insurance Fund is fully supported by premiums paid by borrowers who receive FHA insurance.

HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with HIV/AIDS. The Department also promotes economic and community development as well as enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov.

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