BANKING & FINANCE - Jan. 13, 1996

Fannie Mae Increases Loan Limit: The Federal National Mortgage Assn. increased its 1996 single-family mortgage loan limit to $207,000, effective immediately. The move puts Fannie Mae, as the agency is known, at the same loan limit level as its sister government-sponsored enterprise and chief competitor, the Federal Home Loan Mortgage Corp., or Freddie Mac. The 1.9% increase, from a loan limit of $203,150, is in line with a triggering index reported last month by the Federal Housing Finance Board. When the board’s report came out, Freddie Mac immediately went to the higher level, while Fannie Mae stayed at the previous level. Fannie Mae spokesman David Jeffers said the company reconsidered its position after listening extensively to its customers and lenders and concluding that a two-tier system wouldn’t work.