On November 27th the Federal Housing Finance Agency raised the maximum conforming loan limits on mortgages. This is the third year in a row that the maximum conforming loan limits have been increase, after being stagnant for the 10 years prior. The new conforming loan limit has moved up 6.9% to $484,350, from $453,100. High Cost areas have also increased to $726,525.
For borrowers this helps to avoid Jumbo products that generally have tougher guidelines and higher credit score requirements. Also, for a borrower that may not be able to qualify for a Jumbo product, they now have more options to purchase at higher valued homes.
Here in Fresno County we are still looking for a bump in the FHA loan limit maximums. The maximum dropped from $381,00 to 281,750 almost 5 years ago and has only improved to $294,515 since. The increase in FHA maximum loan limits would allow borrowers with derogatory items such as Bankruptcy, Foreclosure, Pre-Foreclosure, or Short Sales to come back to the market sooner than Conventional Loan.