The Federal Housing Finance Agency (which handles mortgages by Freddie Mac, Fannie Mae, and the Federal Housing Administration) announced its raising its loan limit for prospective purchasers in 2022.
“Compared to previous years, the 2022 Conforming Loan Limits represent a significant increase due to the historic house price appreciation over the last year. While 95 percent of U.S. counties will be subject to the new baseline limit of $647,200, approximately 100 counties will have conforming loan limits approaching $1 million," explained Sandra L. Thompson, FHFA Acting Director.
The agency said Tuesday that U.S. house prices rose 18.5% from the third quarter of 2020 to the third quarter of 2021, the fastest appreciation on record.
In 2022, more homes will qualify for a conforming loan with lower down payment requirements and easier lending standards – the two challenges holding many buyers back over the last year. The path to home ownership should be a littler easier for many prospective buyers since rising loan limits let a wider group of borrowers qualify for the loans backed by Fannie and Freddie.
“FHA loans can be very beneficial if you don’t have as much savings, or if your credit score could use some work,” explained a recent Forbes article.
Source: https://www.keepingcurrentmatters.com