There’s good news and bad news. First the good news …

On Monday, September 26, the U.S. Senate passed the Continuing Appropriations Act (H.R. 2608), which also includes a provision extending the National Flood Insurance Program (NFIP) until November 18, 2011. Next week, the House is expected to approve this extension and has ensured that there will be no lapse in NFIP authority in the interim.

The National Association of REALTORS® is urging Congress to finish its work on the 5-year reauthorization bill (H.R. 1309) before this latest extension ends, in order to provide certainty and avoid further disruption to real estate markets.

And the bad news …

After an unsuccessful attempt to include an extension of the existing loan limit in the continuing resolution to keep the federal government running, Congress failed to extend the FHA (Federal Housing Administration) and GSE (Government-sponsored Enterprise) mortgage loan limits.

On Oct. 1, the conforming loan limits will decline in 669 counties in 42 states, including San Mateo and Santa Clara counties. The new limits will be equal to 115 percent of the local area median home price (down from 125 percent). The high cost cap will fall from $729,750 to $625,500.

The National Association of REALTORS® will continue to work with Congress to attempt to restore the higher limits as quickly as possible.