![fhfa announces increase in maximum conforming loan limits for fannie mae and freddie mac in 2017 fhfa announces increase in maximum conforming loan limits for fannie mae and freddie mac in 2017](https://webassets.inman.com/wp-content/uploads/2021/10/GettyImages-80050777.png)
#FHFA ANNOUNCES INCREASE IN MAXIMUM CONFORMING LOAN LIMITS FOR FANNIE MAE AND FREDDIE MAC IN 2017 PROFESSIONAL#
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. Brown, president of the National Association of REALTORS®, said the move by the FHFA "is a much-needed recognition of rising home prices in high-cost markets, and a help to first-time and lower-income borrowers looking to utilize an FHA mortgage." Many higher-priced areas of the state will benefit greatly from the higher limit," said Geoff McIntosh, president of the California Association of REALTORS®. "The FHFA recognizes that home prices have recovered, not just in California but also across the nation. As a result of efforts by local, state and national REALTOR® associations, cities with high median home prices have benefited from a loan limit above the national conforming loan limit. REALTORS® have long advocated for making higher conforming loan limits permanent. home price remained below the level achieved in the third quarter of 2007, so the baseline loan limit had not been increased.Īccording to the FHFA's third quarter 2016 House Price Index (HPI), average home prices are now above their level in the third quarter of 2007. The expanded-data HPI value for the third quarter of 2016 was roughly 1.7 percent above the value for the third quarter of 2007, so the baseline loan limit will increase by that percentage. home price returned to its pre-decline level. Until this year, the average U.S. The Housing and Economic Recovery Act of 2008 established the baseline loan limit of $417,000 and requires this limit to be adjusted each year to reflect the changes in the national average home price. However, after a period of declining home prices, HERA made clear that the baseline loan limit could not rise again until the average U.S. This increase gives thousands of home buyers the opportunity for homeownership," said Karen Trolan, president of the Silicon Valley Association of REALTORS®. For higher-cost places like Silicon Valley, the more that the conforming loan limit is raised, borrowers have better access to affordable long-term, fixed-rate mortgage credit. "We are pleased that the FHFA has raised the existing Fannie Mae and Freddie Mac conforming loan limits. Non-conforming or jumbo loans typically carry a higher mortgage interest rate than conforming loans, increasing monthly payments and negatively impacting affordability for families to purchase homes. The conforming loan limit determines the maximum size of a mortgage that Government Sponsored Enterprises Fannie Mae and Freddie Mac can buy or guarantee. Maximum loan limits for 2017 are up in all but 87 counties or county-equivalents in the U.S., according to the FHFA. In most of the country the 2017 maximum loan limit for one-unit properties will be $424,100, an increase from $417,000. In high-cost areas like Santa Clara and San Mateo counties and most counties in the Bay Area, the cap will be $636,150, up from the previous loan limit of $625,500. REALTORS® applaud the Federal Housing Finance Agency's recent decision to increase the maximum conforming loan limits for mortgages acquired by Fannie Mae and Freddie Mac in 2017. This will be the first increase in the baseline loan limit since 2006.