Dive summary:

• Word is circulating in Washington that federal officials may bring down the limit on how big a mortgage can be federally insured, hoping to back the government out of the mortgage market at least a little bit.
• The current top end is $417,000 in most of the country and $625,000 in a few markets where home prices are in a league of their own, such as San Francisco.
• The change may not appear major – the head of the Mortgage Bankerts Association says he suspects $400,000 and $600,000 – but housing interests are marshaling arguments against doing anything to take any buyers out of the market.

From the article:

While the Federal Housing Finance Agency, which oversees both government-sponsored enterprises, has not disclosed how far the drop in loan limits will be, such an adjustment will take effect at the start of next year because that’s when the statute requires normal loan limit changes to take place. ...