As part of the Washington, D.C., metropolitan statistical area, Jefferson is one of 80 jurisdictions where the FHA can now insure loans of up to $312,895, the Department of Housing Urban Development said.

Effective Jan. 1, the new FHA "ceiling" in high cost areas is 87 percent of the limit on loans which can be purchased by Freddie Mac. The Freddie Mac/Fannie Mae conventional loan limit rose to $359,650, also on Jan. 1. In most of the nation's 3,300 other jurisdictions, the FHA "floor" is $172,632. But in about 530 places, the FHA maximum is somewhere in between $172,632 and $359,650.

The new limits already are the subject of controversy. For example, some Chicago area lenders already are grumbling that Jefferson County, a distant Washington area jurisdiction at best, is considered a high-cost area but Cook County, Ill., is not.

But HUD sets the FHA ceilings based on the National Housing Act, which says the maximum should be 95 percent of the median house price for a given area.

The law also allows for exceptions. For example, it says the limit cannot exceed 87 percent of the Freddie Mac ceiling, nor can it be lower than 48 percent of the Freddie maximum.

Consequently, areas where 95 percent of the median is less than 48 percent of the Freddie limit use the floor, or $172,632, as their maximum, and areas where 95 percent of median exceeds 87 percent use the ceiling, or $312,895, as their maximum.

Areas where 95 percent of median is between the floor and the ceiling -- such as Cook County -- use the 95 percent figure.