Want to find out what this change means for your conventional loan purchase? Follow the link below to chat with a loan officer.
Talk to a Loan Officer
Get a personalized plan or ask any questions to our dedicated loan officers.
The Federal Housing Finance Agency has increased conventional loan limits by $98,950 for the year ahead. The new conforming loan limit for single-family homes is $647,200. In higher-cost markets like AK and HI, the max limit is $970,800.
This marks the 6th straight annual increase, and according to Inman News, it’s the largest increase in records dating back to 1970.
OVM Financial will honor the announcement by accepting conventional rate locks for loans within the 2022 limits, per FHFA’s announcement.
Conforming Loan Limits Chart (2020-2022)
| Units | 2021 Conforming Loan Limits | 2022 Conforming Loan Limits |
| 1 | $548,250 | $647,200 |
| 2 | $702,000 | $828,700 |
| 3 | $848,500 | $1,001,650 |
| 4 | $1,054,500 | $1,244,850 |
High Balance Conforming Loan Limits Chart (2020-2022)
| Units | 2021 High Balance Conforming Limits | 2022 High Balance Conforming Loan Limits |
| 1 | $822,375 | $970,800 |
| 2 | $1,053,000 | $1,243,050 |
| 3 | $1,272,750 | $1,502,475 |
| 4 | $1,581,750 | $1,867,275 |
Understanding Conforming or Conventional Loan Limits
What are Conforming Loan Limits?
Conforming loan limits apply to conventional mortgages underwritten by Fannie Mae or Freddie Mac guidelines. Conventional loan limits vary based on each county. Some higher-cost county limits vastly exceed this new limit. Conforming loans in these counties are called “high-balance” loans.
BUY A HOME IN 4 EASY STEPS
Get your free guide and learn how to simplify the home buying process with our
4-step method.
What Causes Conventional Loan Limits to Increase?
Each year, FHFA considers adjusting limits to reflect the average home prices across the country. As the demand for homes continues to grow, home prices follow suit. According to Statista.com, the average sales price of a new home in 2020 was $389,400 U.S. dollars and in 2021, it reached $408,800 U.S. dollars.
The FHFA’s decision to increase conforming loan limits in 2022 will help modern home buyers receive the larger loan amounts they need to purchase homes at their current market value.
Will this Impact FHA Loan Limits?
Most mortgage loan types have a ceiling or limit. When the conforming limit increases, the FHA loan limits also increase. However, conventional and FHA loan limits are not the same.
Fannie Mae and Freddie Mac loan limits are higher than FHA limits.
How Can I Take Advantage of the Loan Limit Increase?
If you’re ready to explore your home financing options, our team of mortgage pros will be happy to help you compare loan programs and determine the best fit for your unique needs.
We can help you create a personalized mortgage plan
Our team of experts will design a mortgage plan that’s unique to your goals.
The post Conforming Loan Limits Increase for 2022 Home Buyers appeared first on OVM Financial.