Conventional Loans are now bigger and better. The Federal Housing Finance Agency (FHFA) announced the new conforming loan limits for mortgages sold to Fannie Mae and Freddie Mac in 2020.
In most of the U.S., the new 2020 maximum conforming loan limit for one-unit properties will be $510,400. This is an increase from $484,350 in 2019.
Loan Limits by Property Type
- 2020 One-Unit Loan Limit: $510,400
- 2020 Two-Unit Loan Limit: $653,550
- 2020 Three-Unit Loan Limit: $789,950
- 2020 Four-Unit Loan Limit: $981,700
How are Conforming Loan Limits Calculated?
The new Conventional Loan Limit of $510,400 is the baseline limit for one-unit properties in United States. There are certain areas in the country that are considered to be high cost, such as Alaska and areas of California.
In order for these areas to be deemed as high cost, 115% of the local median home value must exceed the baseline loan limit for that county. The high cost loan limited in these areas will increase by 150% of the baseline.
This makes the maximum loan limit for these areas $ 765,600. A map of the U.S. counties and their maximum loan limits can be found here. There are no counties in Michigan that are considered to be a high cost area.
Are there loans options for over the Conventional Loan Limit?
There are mortgage options available if your require financing over $510,400. If the loan amount exceeds the conforming loan limit, the mortgage is called a jumbo loan.
These non-conforming loans follow a different set of guidelines and rates than conforming loans. As a Mortgage Broker, Riverbank Finance is able to offer a wide variety of Jumbo loan options with low rates and low down payments.
Apply for a Conventional Home Loan
A conventional mortgage is the most popular home loan type. Conventional loans offer some of the lower mortgage rates and payments available for buying a home or refinancing. To apply for a Conventional Home Loan call Riverbank Finance today at 1-800-555-2098.