House Unanimously Passes the FHA Multifamily Loan Limit Adjustment Act
Washington, DC – September 21, 2009 – (RealEstateRama) — On Tuesday, the House unanimously passed the Federal Housing Administration (FHA) Multifamily Loan Limit Adjustment Act, a bill coauthored by Congressman Miller, to address the need for new construction or substantial rehabilitation of multifamily units in extremely high cost areas of the country. Through a public-private partnership, FHA’s multifamily mortgage insurance programs enable qualified borrowers to obtain financing for a variety of multifamily properties that are affordable to low and moderate-income families. However, developers are simply unable to provide affordable housing units in high-cost areas because the current statutory limits for FHA mortgage insurance are too low for elevator style buildings. This means that in our nation’s most expensive cities, it is very difficult for workers such as police, firefighters, and teachers, to find affordable rental housing where they work. In fact, because of its loan limits, there were only three FHA-insured multifamily loans for high-rise construction or rehabilitation approved across the country in Fiscal Years 2007 and 2008. In order to address this issue, the FHA Multifamily Loan Limit Adjustment Act will increase the multifamily loan limits for high-rise elevator style buildings by up to 50 percent, reflecting the true disparity in construction costs. Upon enactment of this bill, it is estimated 12,000 new construction jobs will be created. The FHA multifamily mortgage insurance program has operated successfully for 75 years and has provided a profit for taxpayers. Specifically, the multifamily mortgage insurance program that relates to these loan limits is projected to make a profit on new loans insured in Fiscal Year 2010 of $93 million. Congressman Miller is pleased the House has passed this important legislation to provide new jobs and housing opportunities across the country. To view his Floor speech, click here.
