For the first time ever, the U.S. government will back mortgage loans that are over a million dollars.
FHFA (Federal Housing Finance Admin.) has raised the ceiling in high-cost counties (hello California and Western WA) to $1,089,300 for 2023.
For the rest of the counrty, the allowed loan amount has gone up to $726,200.
Some lenders will put those higher loan amounts into effect almost immediately, especially the wholesale lenders (that you can take advantage of by going through a local mortgage broker).
What this means is that more people can get a higher priced home without having to go for a Jumbo loan. Jumbos have higher interest rates, larger down payment requirements, and stricter underwriting rules, so this change is good for buyers, sellers, and everyone in the real estate or mortgage business.
These higher loans are for owner-occupied, one-unit properties.
The FHA conforming loan limit for 2023 has not yet been announced, but the expectation is for $472,040.
If you need work to get your credit score over 700 for the best conventional loan interest rate (or over 620 for FHA), start now so you’ll be ready to purchase a home next year.
While you’re shopping for others, pick up a little something to make your own life better:
Repair Your Credit Like the Pros here.