FHFA Announced Increase in Conforming Loan Limits for 2020
The Federal Housing Finance Agency announced loan limit changes and is raising the conforming loan limits for Fannie Mae and Freddie Mac to more than $510,000.
FHA raises the 2020 maximum conforming loan limit to $510,400, up from 2019’s level to $484,350.
Median home values generally increased in high-cost areas in 2019, driving up the maximum loan limits in many areas. The new ceiling loan limit for one-unit properties in most high-cost areas will be $765,600 — or 150% of $510,400.
For a map showing the 2020 maximum loan limits across the U.S., click here
Government backed loans typically follow suit. They will match the new conforming loan limits but there is not formal announcement currently.
Vellum is immediately accepting mortgage applications with the new loan limits.
VA Loan Limits to be Lifted in 2020
Earlier this year, the President signed a bill that allows the Department of Veterans Affairs to back loans that exceed the conforming loan limit. The bill, H.R. 299, enables homebuyers using a VA loan to borrow above the 2019 limit without any down payment.
In addition to alleviating limits for veterans looking to purchase a home, H.R. 299 temporarily increases rates for certain loans by 0.15-0.30%, the VA said. The slight bump in loan fees intends to help finance health care costs for veterans who are suffering the effects of Agent Orange exposure as a result of their service.
Additional changes to the VA’s loan guaranty program include the elimination of funding fee differences for borrowers who are veterans versus those who are members of the Reserve. It also removes the loan limit for the Native American Direct Loan Program. Additionally, it exempts Purple Heart recipients from paying loan fees. It also authorizes VA-designated appraisers to rely on third parties for appraisal-related information.
VA loan limit will be lifted for loans that are guaranteed on or after January 1, 2020.