There’s good news for future homebuyers, thanks to rising home values. The Federal Housing Finance Agency (FHFA) recently announced the maximum conforming loan limits for mortgages to be acquired by Fannie Mae and Freddie Mac in 2018. In its Q3 2017 House Price Index report, the FHFA revealed that house prices increased 6.8% in the last year. In turn, 2018 will see an increase in the baseline maximum conforming loan limit.
In many states, the maximum conforming loan limit for one-unit properties will increase to $453,100. Up from the current $424,100. These changes are due to the Housing and Economic Recovery Act (HERA) which require Fannie Mae and Freddie Mac to reflect the average U.S. home prices each year. The increase will impact all but 71 U.S. counties.
For one-unit properties, it’s important to note that if the local median home value exceeds the baseline conforming loan limit by 115%, the maximum loan limit will be higher than the baseline loan limit. In these situations, the maximum loan limit is established by HERA with a limit of 150% of the baseline loan limit. The limit is 150% of $453,100 or $679,650.
Have questions about the new conforming loan limits? Give us a call at 949-356-6400.