Quoted from article in San Jose Mercury News.
"Offering a ray of hope for a struggling California housing market, the government Wednesday doubled the limit for loans guaranteed by the Federal Housing Administration in 14 high-cost California counties, including Santa Clara County.
New, temporary limits announced by the U.S. Department of Housing and Urban Development were derived from median home prices in each county, and top out at $729,750. Previously, the maximum was $362,790.
The state was the epitome of runaway price appreciation during the housing boom, but is now experiencing one of the most severe corrections in the country.
Before the subprime lending spree of the past several years, loans backed by the FHA were traditionally a top choice for first-time home buyers who wanted to buy with low down payments. But because the maximum allowable loan amounts were fairly low, FHA-backed loans have been used infrequently in the Bay Area in recent years."
Whole story http://www.mercurynews.com/breakingnews/ci_8463914?nclick_check=1
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