Department of Housing and Urban Development January 13, 2012 – Federal Register Recent Federal Regulation Documents

This proposed rule would eliminate the process for requesting alternative FHA maximum mortgage amounts. HUD currently sets the area- based loan limits on a yearly basis and permits appeals of these loan limits. At the time the regulations permitting appeals were promulgated, there were no comprehensive, national databases of home sales transactions. As a result, HUD relied on sales data provided by interested parties in determining loan limits for certain areas. Today, however, HUD has available comprehensive direct sales transaction data and indirect home value data at the county level. In addition, since HUD began this new information collection on price trends at a county level, the number of parties utilizing the appeals process has gone from 105 for the 2008 loan limits to zero for the 2011 loan limits. For these reasons, HUD has determined that the regulations governing requests for alternative maximum mortgage amounts are outdated and unnecessarily disrupt HUD's loan limit determination process. The elimination of this appeals process would allow HUD to release its annual loan limits one month earlier than it has for the past three calendar years. This difference would provide more certainty in the mortgage lending market.