It’s the Government…what did you expect?

(Riverside, California)…As part of the governments economic stimulus plan (more on that insanity in some later post), there is supposed to be a raise in the maximum loan limits on two very important loan programs…FHA and Fannie Mae.  These loan limits are to be increased to a more viable amount so that perhaps some of today’s hurting home owners can possibly refinance with a better loan…and naturally, since the newspaper has reported all this information, then, of course, it must be both factual AND HAPPENING RIGHT NOW.

But alas, it is our government, and nothing happens RIGHT NOW.  I mean, come on, where have you been?  Just to set the record straight, a few items to note.

First, in a general sense, just because the newspaper says it’s so, does not necessarily mean it is so (see Gore wins Florida, and steriods are not in baseball, for examples).

 Secondly, the raising of the FHA loan limits would be a good thing for our Riverside area, but FHA has made it very clear that they will not have an answer until late March, early April…which in government speak could mean by summer.  Also, we really needed these loan limit increases a few years ago.  They would be nice now, but the maximum limits were so far behind the times that no one could use them as a lender because every house was more expoensive than the current limit.  Now, since the market has changed just a little bit (note the sarcasim), who knows what limits FHA will now give us.  In any case, something is better than nothing, but please do not hold your breath for an immediate raising of the limit to help you out.  The Fed’s will get to it when they are in the mood, and unless you know a way to fight this giant behemoth of inertia, then sit tight, and they will let us know…and we will let you know.

 Thirdly, the same goes for Fannie Mae as well.  The new loan limt is reported to be $717,000 (ever wonder how they arrived at that odd number), BUT IT IS NOT IN EFFECT JUST YET.  Again, simply because it has been mandated by the President as part of his plan does not make the pumpkin turn into a carriage immediately.  This too would be great news for our area, but we will simply have to wait for our time to come, and hope that our real estate pumpkin does not start smelling any worse until it does.

So, there you have it.  What have we learned today?  To summarize….higher loan limits are good, they are coming soon (see government definition of the word soon), the press is not always right, and that our government operates at a dial-up pace in a broadband world!

Class adjourned.