This ARTICLE On Fannie Mae And Freddie Mac Increases Conventional Loan Limit To $510,400 Was PUBLISHED On November 26th, 2019
The housing market is booming.
- Actually, the housing market has been on fire for the past several years with no sign of a correction
- With the exception of a few states, home prices have been escalating to record-high levels
- Homebuilders are thriving and are expecting another stellar record year in 2020
- There is more demand for homes than in inventory
- The government is aware of this and is on top of it
- Adding fuel to the fire on home demand, lenders are launching non-QM and alternative financing programs such as Non-QM loans, bank statement loans for self-employed borrowers, asset-depletion mortgage programs, and other niche mortgage programs
- HUD and the FHFA have increased maximum loan limits for the past three years due to increasing home prices
- Today’s breaking news is Fannie Mae and Freddie Mac increases conventional loan limit to 2020
- The new increase in conforming loan limits will take effect on January 1st, 2020
In this article, we will cover and discuss Fannie Mae And Freddie Mac Increases Conventional Loan Limit to $510,400 for 2020.
Conventional Loan Limit Increases Four Years In A Row
Fannie Mae And Freddie Mac Increases Conventional Loan Limit for 2020 to $510,400 in most counties in the United States.
- High-cost areas will have higher conforming loan limits
- The reason for conforming loan limit increases year after year for the past four years is due to rising home prices in the Nation
- Fannie Mae And Freddie Mac Increases Conventional Loan Limit for 2020 markets an increase of almost $100,000 since November 2016
- The booming economy and the lowest unemployment rate in 50 years is boosting the housing market like never before
- The breaking news of the conforming loan limit increase to $510,400 for 2020 was announced by the Federal Housing Finance Agency (FHFA) on Tuesday, November 26th, 2019
In most communities in the U.S., the conforming loan limit will be increased to $510,400 from the current $484,350. Again, the conforming loan limit has been increasing substantially for the past four years. The FHFA has not had any conforming loan limit increases from 2006 to 2016. These increases by the FHFA is historic and says a lot about the housing market.
Historic Trend In Conforming Loan Limit Increases
There was no loan limit increases in almost a decade from 2006 until 2016.
- The Federal Housing Finance Agency increased conforming loan limits for the very first time in 10 years in 2016
- Since 2016, Conventional Loan Limits have increased by $93,400
- In 2016, the Federal Housing Finance Agency spiked the conforming loan limits to $424,100 from $417,000
- Then in 2017, the conventional loan limits were increased to $453,100 from $424,100
- Then in 2018, the FHFA increased the conforming loan limits to the $484,350 cap from the $453,100 limit
With today’s breaking news, the 2020 Conforming Loan Limit cap is at $510,400.
Which Agency Determines Fannie Mae And Freddie Mac Increases Conventional Loan Limit
The conforming loan limits on conventional loans are determined by the Housing and Economic Recovery Act of 2008. This was established with the baseline loan limit at $417,000 and mandated that. After a period of price declines, the baseline loan limit cannot rise again until home prices return to pre-decline levels.
Fannie Mae And Freddie Mac Increases Conventional Loan Limit for 2020 to $510,400 is great news for homebuyers. Many homebuyers were being priced out of the market due to high home prices.
What This Breaking News By The FHFA Mean To Other Loan Programs
Historically, whenever the FHFA announces the increase of conforming loan limits, HUD, the parent of FHA, follows right behind them. Gustan Cho Associates Mortgage News is anticipating news by HUD increasing FHA Loan Limits for 2020. When this news breaks on the new FHA Loan Limits, we will release it right away for our viewers. President Donald Trump signed into law exempting the maximum VA Loan Limit a few months ago. The VA has no maximum loan limit on VA Home Loans. We will update our viewers as more breaking news develops. Stayed Tuned!!!
November 26, 2019 - 3 min read