Each year the conforming government agencies (Fannie Mae and Freddie Mac) along with the government insured loan programs (FHA and VA) revisit the maximum loan limits in each county across the country. The goal is to modify limits to be responsive to the home values and average loan sizes in each area to ensure lending opportunities remain viable for as many borrowers as possible.
The conforming loan limit for 2019 has increased as a result of increased property values. Beginning in 2019, the maximum loan amount for a 1 unit property is $484,350, which is a $31,250 increase over the current $453,100 maximum.
In most cases these ‘conforming’ mortgages have better rates than jumbo and portfolio loans that aren’t underwritten to the agency guidelines, though this isn’t always the case.
In general, if a loan amount is at or below the conforming limit you will have the most loan options available to you, the best pricing and the most flexible guideline nuances. Moreover, conventional loans offer certain advantages such as a ‘property inspection waiver’ (no appraisal) and limited due diligence on condominiums which can allow for certain transactions to commence that would otherwise be problematic.
When it comes to ‘high balance’ mortgage limits (loans over the maximum detailed above), there has also been an announced increase for 2019. The new high cost loan limit is increasing to $726,525 on a one unit property.
While not always the case, 2019 will bring uniformity in loan limits across all three categories of loan programs mentioned above (Agency, FHA and VA). FHA and VA both recently announced they’ll be following exactly the limits for 2019 announced from Fannie Mae and Freddie Mac ($484,350 and $726,525) so borrowers taking advantage of those programs will have the same loan amount maximums to work with.
The maximum loan amounts ultimately vary by county and NGG Mortgage works with borrowers throughout California serving all the counties within the state. Your individual Loan Officer at NGG Mortgage will be able to advise you on what options are applicable depending on your scenario and the county in which your property resides. NGG Mortgage is ready to advise you with confidence on your best options.