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Rachel LaMar, J.D.
Broker, Attorney, Owner
LaMar Real Estate
Rachel@LaMarRealEstate.org
Cellular 760-310-9466
CA BRE# 01399682

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News, Views and Opinions on Real Estate, Law and the North San Diego Community

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rachel
L high res

Rachel LaMar, J.D.
Broker, Attorney, Owner
LaMar Real Estate
Rachel@LaMarRealEstate.org
Cellular 760-310-9466
CA BRE# 01399682

News, Views and Opinions on Real Estate, Law and the North San Diego Community

Coming Right Up: More Buying Power For Buyers

Attention buyers using loans to purchase property: your buying power will be increasing this Spring. The Federal Housing Finance Agency announced it will be increasing conforming loan limits almost $38,000 starting in March.

First let’s look at what exactly a conforming loan limit is. Fannie Mae and Freddie Mac are the guarantors of the majority of loans in the U.S. In order for them to mortgage a property there are requirements that must be met – when the requirements are met these are conforming loans.

Conforming loan limit baselines for Fannie Mae and Freddie Mac loans are required to be adjusted each year based on changes in average U.S. home prices, which this year was over 7.4%. In higher priced areas the maximum loan limit will be higher than the baseline. Since here in San Diego County we have seen prices rise (again) this year, we will see higher maximum conforming limits in higher priced areas.

Most higher-cost areas will have a new maximum loan limit on one-unit properties of $822,375. Anything above this amount will be considered a jumbo loan.

What does this mean for buyers?
1. It keeps down payments lower. Those loans that are not considered conforming (higher loans or “jumbo” loans) can still be attained but the buyer must put more money down.
2. The annual percentage rate (APR) remains lower – this includes lender fees the buyer pays to originate a loan.
3.
Most lenders prefer to work with loans that fall within the conforming loan guidelines because they are insured by Fannie and Freddie, making them safer risks, so buyers will have an easier time shopping a loan that is conforming.

To find out more about conforming loans and your purchase loan options make sure you speak with an experienced and dedicated mortgage professional. If you need help finding one I am happy to provide referrals 🙂

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