FHA and Conforming loan limits will drop dramatically on September 30. Bank of America has already lowered their loan limits for new loans, and others will follow suit.And from "HousingWire":
The conforming loan limit determines the maximum mortgage amount the Federal Housing Administration, Fannie Mae and Freddie Mac can buy or guarantee. Without congressional action, the limit will drop to $625,500 from $729,950 for the majority of counties nationwide on Oct. 1.Almost 60% of single family homes and condos that sold in San Francisco during the first half of this year had a selling price below the current maximum. Not all of those sales would have been affected by a lower limit but it provides a general idea of the scope of the impact a reduction may have.
This is an issue for sellers as much as buyers and could have a significant impact on our slowly reviving housing market. There are some efforts underway to get the congress to keep loans limits where they are but it's not at all clear that will happen.