Increasing loan limits will enable more homebuyers to obtain lower rates
Certainty is excited to announce that we are raising our conforming loan limits for 2022, even before the Federal Housing Finance Agency (FHFA) officially announces the new limits in November for Fannie Mae and Freddie Mac. This new limit for one-unit properties has been increased to $625,000 and will take effect immediately.
Due to home values rapidly growing throughout 2021, more and more hopeful homebuyers have been pushed towards jumbo loan options instead of conventional financing. This has had a huge impact on buyer’s ability to qualify because jumbo mortgages typically have stricter qualifying criteria, and often come with higher interest rates and down payment requirements.
Increasing the loan limits from $548,250 to $625,000 should bring relief and allow many borrowers to take advantage of conventional financing at lower rates.
“We are seeing that homebuyers across the country are feeling the impact of increasing home values,” said Jim Clapp, President of Certainty. “Coupled with low inventory, it’s been a tough market for many buyers. We believe that increasing the conforming loan limits early will allow us to better support our customers in this competitive housing market.”
Interest rates are still very low, and Certainty is committed to providing our customers with the opportunity to take advantage of those rates and benefit from greater housing affordability.
Fannie Mae and Freddie Mac
The FHFA oversees Fannie Mae and Freddie Mac, which were created by Congress to perform important functions on the government's behalf to provide liquidity, stability, and affordability to the mortgage market. They don’t issue mortgages themselves, but they do purchase about half of all loans that mortgage lenders make and set the standards homebuyers must meet to qualify for a conforming home loan.
If you have any questions about how this change to the maximum conforming loan limits may affect you, we are happy to help answer your questions. A home is one of the biggest purchases of your life, and you deserve a knowledgeable advisor you can trust. Find a local Loan Officer here to get started.
*$625,000 loan limit update. Conventional conforming loans only. Effective 10/08/21 through 12/31/2021. Loan limits may be higher in certain high-cost areas.