Home Buyers utilizing the Conventional Mortgage are seeing an increase in conforming home loan limits. Loan limits generally keep pace with housing prices in various regions and have been adjusted upward for the 2019 housing market. The conforming limit does not refer to the price of the home, rather it is the high end of allowable mortgage amount. Your down payment will determine in what price range the home must fall.
A conforming home loan is one that stays within a the bounds set by FHFA, Federal Housing Finance Agency. Other criteria must be met as well including debt-to-income ratios, adequate credit score and loan-to-value guidelines. Home Loans above the conforming amount are classified as nonconforming or Jumbo Mortgages and are subject to larger down payments, higher interest rates and stricter guidelines.
Mortgage rates for conventional and FHA home loans are still in the moderate range, having actually dropped this past week. Low mortgage interest rates and static home prices along with a lukewarm post-holiday market, make this an opportune moment for home buyers to seize the day!
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Conforming Mortgage Loan Limits Increase for Home Buyers
By RISMedia Staff
The Federal Housing Finance Agency (FHFA) has announced its 2019 loan limit will rise by 6.9 percent to $484,350, in response to rising values. In costlier markets, the limit will rise to $726,525. All told, there will be an increase in loan limits in all but 47 counties in the U.S. Find out your limit.
The baseline loan limit is mandated by the Housing Economic and Recovery Act (HERA).
“The National Association of REALTORS® [NAR] is pleased to see the Federal Housing Finance Agency raise its national conforming loan limits for 2019,” said John Smaby, NAR president, in a statement. “[This] decision reflects rising or near-record high home prices in many U.S. markets, and the move helps keep the American Dream within reach for countless families working with Fannie Mae and Freddie Mac.
“Without this assurance that loan limits keep up with home price growth, borrowers across the country risk being pushed out of the market altogether as mortgage rates and rising home prices continue to hold back potential homebuyers,” Smaby said.
Reprinted with permission from RISMedia. ©2018. All rights reserved.
