HUD Archives: News Releases

Lee Jones
(804) 771-2100 ext. 3743
For Release
November 15, 2004

Increase Based on Sales Data Submitted by Blue Ridge Association of Realtors and Covers Winchester, Frederick County and Hampshire County, West Virginia

RICHMOND - The U.S. Department of Housing and Urban Development has approved a 48 percent increase in the maximum mortgage that can be insured by the Federal Housing Administration (FHA), a part of HUD in Winchester, Frederick County, Virginia, and Hampshire County, West Virginia.

The increase is effective immediately and is based on a request and recent home sales data submitted to HUD by
the Blue Ridge Association of REALTORS.

As a result of HUD's decision, the FHA mortgage insurance limit on one-family homes will rise from $160,176 to $237,500; the FHA mortgage limit on two-family homes will rise from $205,032 to $267,500; the FHA mortgage limit
on three-family homes will rise from $247,842 to $325,000; and the FHA mortgage limit on four-family homes will rise from $307,992 to $375,000.

"The housing market in the Winchester area is strong and getting stronger," said HUD Richmond Field Office Director Mary Ann Wilson, "and this increase permits FHA to remain competitive in the market and responsive to those who want to own a piece of the American Dream."

Over the last 10 years, FHA has insured some 4,000 mortgages in the Winchester-Frederick-Hampshire area with a total dollar value of $374 million. Over the same period, the average value of an FHA-insured home in the area has increased 55 percent to $118,151.

The increase in loan limits will enable more working families to become homeowners and will help the FHA mortgage insurance program to keep pace with the robust housing market. Low-income and first time homebuyers are
attracted to FHA-insured loans because the agency requires only a three percent downpayment and permits family and friends to contribute to the initial home buying expenses. In addition, FHA has more relaxed credit standards
and permits borrowers to carry more debt than private mortgage insurers typically allow.

The higher FHA loan limits will not cost the government any money, because the FHA Insurance Fund is fully supported by premiums paid by borrowers who receive FHA insurance.

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.

HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities, creating affordable housing opportunities for low-income Americans, supporting the homeless, elderly, people with disabilities and people living with 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 and


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