November Real Estate Roundup: New Conforming Loan Limits
WHAT YOU'LL LEARN
What are loan limits?
What's a conforming versus Conventional loan?
2024 conforming loan limits and how they help buyers
WHAT YOU'LL LEARN
What are loan limits?
What's a conforming versus Conventional loan?
2024 conforming loan limits and how they help buyers
Atlantic Bay has great news! Effective immediately, we’ve increased our conforming loan limits to $766,550 for one-unit properties. That’s roughly 5% higher than the previous $726,200. Now more of your buyers can enjoy more flexible lending and down payment options for larger Conventional loan amounts, instead of requiring “jumbo” loans, which are typically harder to qualify for and carry higher interest rates because they’re not backed by Fannie and Freddie.
Why the Changes?
The Federal Housing Finance Agency (FHFA) announces loan limit changes annually in November, and they are reflective of current home prices across the U.S. As home prices increase, loan limits are responding accordingly.
What Are Conforming Loan Limits?
Conforming loan limits are a dollar cap on a mortgage that Freddie Mac and Fannie Mae will guarantee. The Federal Housing Finance Agency (FHFA) regulates Fannie and Freddie and updates these limits annually in the fall. The limits reflect current home prices across the U.S. As home prices increase or decrease, loan limits respond accordingly.
PS - the terms “conforming” and “conventional” are often used interchangeably, but there are some differences. All conforming loans are conventional loans, but conventional loans can be conforming or “non-conforming,” which means they don’t meet Fannie/Freddie funding criteria (jumbo, etc.).
What About Limits on Other Loan Programs?
Government-backed loan programs like Federal Housing Administration (FHA), United States Department of Agriculture (USDA), and Department of Veteran Affairs (VA) also have their own limits, set by their respective agencies annually. I’ll let you know when the 2024 numbers become available!
And remember, “non-conforming” isn’t necessarily a bad thing! Put simply, non-conforming loans can mean those government-backed loans, jumbo loans for more expensive properties, or “non-qualified” mortgages specially designed for non-traditional buyers like a retirees or self-employed “gig economy” workers.
I’m always here to help you and your buyers with any questions. Just give me a call!