GREAT NEWS! For the third year in a row, the Federal Housing Finance Authority (FHFA) has increased the amount of money that can be borrowed through a standard home loan. Even if you are not planning to buy soon, you will definitely want to know how this news can still be important to you.
Here are the details:
The standard loan limit (also known as conforming loan limit) rose by 6.9% to a maximum amount of $484,350. In certain high-cost areas, the limits are even more. High-cost area loan limits are established for each county (or equivalent) and are published on Fannie Mae’s website and on FHFA’s website.
The new limits are effective for funded loans on or after November 29, 2018. The Federal Housing Administration (FHA) and VA have not announced their loan limits for 2019.
The percentage increase is equal to the national appreciation average over the last year. Loan limits were kept high for 10 years, even as values declined. Now that the market has surpassed prior peaks, loan limits are on the rise again.
What this increase means to you:
You may be able to purchase a higher priced home with more financing options, possibly including lower rates, and you may be able to refinance an existing, higher-rate “jumbo” loan and possibly drop mortgage insurance premiums, too. You may also be able to combine a 1st and 2nd mortgage.