The ceiling on conforming loans is going up, and it could help you save
Bar Graph Showing Historical Conforming Loan Limits in the U.S. Sourced from Federal Housing Finance Agency via Inman
Source: Federal Housing Finance Agency via Inman.
Fannie Mae and Freddie Mac are expected to raise the limit on conforming loans next month. This should make it easier for homebuyers to keep up with today’s rising home prices without potentially spending more on a jumbo loan.
Conforming loan limits are the maximum amount you can borrow for a conforming loan in each county. If you want to borrow more than today’s most common conforming loan limit of $548,250, you would likely need a jumbo loan. Those can come with tougher eligibility requirements, higher down payment minimums, and often, higher interest rates.
The new conforming loan limit is expected to rise by at least $75,000 to around $625,000—its highest increase since 1970. The change would officially take effect after January 1, 2022, but Better Mortgage plans to implement the new limit once it’s announced. Until then, learn more about the differences between a conforming loan and a jumbo loan.
