U.S. Rep. Gary Ackerman, D-Bayside, said Queens residents are being forced to seek expensive, privately-funded mortgages following the expiration of conforming mortgage loan limits on Sept. 30.
The congressman and 131 other members of Congress recently sent a letter to House Speaker John Boehner, R-OH, and House Minority Leader Nancy Pelosi, D-CA, that asked for their support in reinstating the expired loan limits during the upcoming House-Senate conference committee on appropriations.
“Middle class homeowners are struggling through the most difficult economic times since the Great Depression,” said Ackerman, who is a senior member of the House’s Financial Services Committee. "If a large portion of the housing market is forced to fend for itself, the result will be disastrous for homeowners throughout Queens and all across the country.”
The congressman said Fannie Mae, Freddie Mac and the Federal Housing Administration would be able to guarantee mortgages up to $729,750 in more expensive areas, such as Queens and the other four boroughs, if the loan limits are restored.
A number of Queens residents are seeking privately-funded “jumbo mortgages” that are expensive and require higher down payments following the loan limits’ expiration five weeks ago, Ackerman said.
A conforming mortgage loan is within the limits set by Congress for Fannie Mae, Freddie Mac and the FHA. “Jumbo” loans exceed these limits.
Last week, the U.S. Senate passed a fiscal spending bill that includes an amendment to restore higher conforming loan limits and extends them for two years.
But the amendment was not included in the House version of the bill, Ackerman said.
“We should be doing all we can to stimulate the economy and help the housing sector recover rather than socking homeowners with higher interest rates and larger down payments,” Ackerman said. “Making the cost of mortgages more expensive makes zero sense during these fragile economic times and will only slow the economy’s delicate recovery.”