FANNIE MAE, FREDDIE MAC MAY SAVE HOMEBUYERS CASH.

Byline: GREGORY J. WILCOX Real Estate

Los Angeles area residents planning to buy a home next year got some good news last week from major mortgage players Fannie Mae and Freddie Mac as both boosted their loan limits 7.3 percent to $322,700.

That's a $22,000 increase in the lending cap, above which buyers generally would have to get a jumbo loan that usually carries a higher interest rate.

In today's rate environment it means a borrower could save up to $37,700 in interest over the life of the loan, according to Freddie Mac, the Federal Home Loan Mortgage Corp.

Fannie Mae, the world's biggest nonbank financial services company, is more conservative in its savings estimate, saying the current spread between its rate and jumbo mortgage would reduce interest expense by $23,500 over 30 years.

Officials could not be reached for comment about the discrepancy on Friday.

Both said the limits are being increased to reflect rising housing prices across most parts of the nation.

Whatever the potential savings, the lending limit increases could bring additional new buyers into the nation's real estate market. Fannie Mae said its products would be available to 210,000 additional families, while Freddie Mac said it would enable 250,000 more families to obtain its low-cost loans.

Local officials cheered the news.

``This loan limit increase is great news for Southern California families who can take advantage of the savings provided by a Fannie Mae-financed mortgage,'' Barbara Zeidman, the company's director for Los Angeles and Orange counties, said in a statement.

``This increase will allow more working families to enjoy the benefits of homeownership, especially in our high-cost housing market.''

The new limit is well above the $295,150 median price of a resale home in Los Angeles County during October and close to the $318,500 median in the San Fernando Valley.

However, it is lower than the $339,000 median price in the Santa Clarita Valley.

Nevertheless, this will help maintain momentum in what likely will be a record sales year for both the state, county and Valley.

``You have to say this will keep L.A. County resales moving along,'' said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp. ``This is not going to turn a market, but it will help.''

Kyser also thinks mortgage rates will continue to bump along at low levels for the first part of next year.

Freddie Mac and Fannie Mae, both stockholder-owned corporations chartered by Congress to create money flow to mortgage lenders, also increased the multifamily loan limits.

--The limit on a two-family property increased to $413,100 from $384,900.

--On a three-family property, the limit increased to $499,300 from $465,200.

--On a four-family property, the limit will be $620,500, up from $578,150.