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Conforming Loan Limits to Jump in 2020

Dec 4th, 2019 @ 2:27 PM by Amber Nelson

To keep up with rising home prices, the Federal Housing Finance Agency has determined to raise the 2020 maximum conforming loan limits for Fannie Mae- and Freddie Mac-backed mortgages.

The new single-family property conforming loan limit will increase to $510,400, up from the current $484,350. That jump is based on the 5.38% rise in U.S. home prices from the 2018 third quarter to the 2019 third quarter as reported by the FHFA’s own seasonally adjusted home price index.

“House prices have risen every quarter for the last eight years,” said FHFA Supervisory Economist William Doerner. “Relative to a year ago, market indices are still trending upward for the nation as a whole as well as in every census division, state, and the top 100 metro areas. Price gains, though, are continuing to slow their upward pace in a few cities with large housing markets.”

All states and the District of Columbia experienced home price increases in 2019. Idaho led the nation with an 11.6% home price appreciation rate. It was followed by Maine and Arizona, both at 7.9%, Utah at 7.8% and Indiana at 7.4%. The states with the least appreciation were Illinois with 1.9%, Connecticut at 2.2%, Maryland at 2.4%, South Dakota at 2.7% and Iowa with 3.2%.

For states and areas where the local median home value is 115% or more of the baseline conforming loan limit, the maximum limit will be $765,500, up from $726,525.

Conforming loan limits set the highest mortgage amount that Fannie and Freddie are allowed to buy and guarantee. The VA also follows the FHFA-set conforming loan limits. Mortgages over the conforming limits are called “jumbo loans” and often come with higher interest rates.

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to and

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