Conforming Loan Limits to Be Raised

Dave Towne

Dave Towne

Certified Residential RE Appraiser at Towne Appraisals
AGA, MNAA, Accredited Green Appraiser - Licensed in WA State since 2003.
Dave Towne on e-AppraisersDirectory.com
Dave Towne

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Conforming Loan Limits to Be Raised

FHFA raises conforming loan limits for mortgages acquired by Fannie Mae and Freddie Mac

Appraisers,

The announcement by Federal Housing Finance Agency (FHFA) on November 23, 2016 may affect your fee structure if your fees are higher for loans above the upper limit for home sale prices for a standard mortgage loan, so called conforming loan.

When mortgage loans are for amounts higher than the conforming limit, the loans are termed “Jumbo” loans.

This is not the same as basing appraisal fees on APPRAISED values. As a general statement, Jumbo loans are for homes with excessive characteristics – considered ‘complex’ – than the norm in the area. As such, you may have more TIME invested in those assignments due to limited comparable sales.

Since 2006, the conforming loan limit in most areas has been $417,000. As of Jan. 1, 2017, it will be $424,100 to $636,150. But in four Hawaiian islands, the upper amount will be $636,151+.

This is somewhat confusing, so use this heat map link to ‘see’ (and scroll over) your county and the range that applies.

Excerpt from Mortgage News Daily

After leaving them in a holding pattern for 10 long years the Federal Housing Finance Agency (FHFA) has raised conforming loan limits for mortgages acquired by Fannie Mae and Freddie Mac. Separate loan limit announcements are expected shortly from FHA and the Veterans Administration.

As reported here, FHFA reported on Wednesday that its third quarter House Price Index (HPI) is now 1.7 percent higher than in the third quarter of 2007 and the agency has raised conforming loan limits by 1.7 percent to $424,100. The new loan limits are effective as of January 1, 2017.

More info at Mortgage News Daily

Image credit flickr - Omar Bárcena
Dave Towne

Dave Towne

AGA, MNAA, Accredited Green Appraiser - Licensed in WA State since 2003. Dave Towne on e-AppraisersDirectory.com

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2 Responses

  1. Bill Johnson says:

    Its funny (not really), how the powers that be recognize the extra liability with higher dollar loans and charge accordingly, but yet the extra liability to the appraiser is unrecognized by default (AMC’s banks, direct lenders, etc.,). Not only is a higher fee not considered (99% turned down in my area), but due to higher risk factors the scope of work is increased for the same pay. The monkey is driving the bus in this industry.

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Conforming Loan Limits to Be Raised

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