LOAN LIMIT INCREASE FOR 2021
The Federal Housing Finance Agency (FHFA) announced the new Conforming Loan Limit for Fannie Mae and Freddie Mac for 2021 -- $548,250. This is a 7.5% increase from the 2020 limit of $510,450.
You will also see higher loan limites for multi-family property.
Units |
Max CONVENTIONAL Loan Limit |
1 - Single |
$548,250 |
2 - Duplex |
$702,000 |
3 - Triplex |
$848,500 |
4 - Quadplex |
$1,054,500 |
Given massive year-over-year gains in home prices, the Federal Housing Administration (FHA) is also increasing its 2021 loan limit to $356,362, an increase of nearly $25,000 over 2020's loan limit of $331,760.
Units |
Max FHA Loan Limit |
1 - Single |
$356,362 |
2 - Duplex |
$456,275 |
3 - Triplex |
$551,500 |
4 - Quadplex |
$685,400 |
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OKAY, BUT HOW DOES THIS HELP YOU?
For starters, it could mean better financing terms, lower costs, and more opportunities for both buyers and sellers.
LET'S BREAK IT DOWN
If you exceed the conforming loan limit, it automatically becomes a Jumbo home loan instead of a conventional home loan.
For Example:
A jumbo home loan comes with its own rules, more stringent underwriting guidelines, larger down payments, and typically higher rates.
So increasing the conforming loan limit gives buyers access to easier underwriting guidelines with better rates, less money down, and at a lower cost.
Sellers of higher priced homes may also benefit since more buyers can now qualify with easier conventional terms.
THINGS ARE LOOKING UP IN 2021
If you have questions about financing, need a fast preapproval rate or quote, feel free to schedule a call or send me an email. I'm always here to help.
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