Senate Votes To Restore Higher Mortgage Loan Caps

Law360, New York (October 21, 2011, 6:23 PM EDT) -- The U.S. Senate voted Thursday to raise by up to 15 percent the cap on home loans that can be guaranteed by government-controlled mortgage insurers Fannie Mae, Freddie Mac and the Federal Housing Administration, signaling continued concern over the credit market's slow recovery.

The move would raise the ceiling for federally backed mortgages up to levels set in 2008, when Congress increased the limits to help boost the housing market as banks tightened their belts. Those increases expired Oct. 1.

The legislation's co-sponsor, Sen. Robert Menendez,...
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