Conforming Mortgage Levels Increase for 2017 -

The federal government is increasing the levels for conforming mortgages from $417,000 to $424,100 in most areas of the United States starting Jan. 1, 2017, the Federal Housing Finance Agency announced last Wednesday-the first such increase since 2006.

Conforming Mortgage Levels Increase for 2017

The approximately 1.7 % bump in the baseline conforming loan limit follows the FHFA’s announcement that the average U.S. home price has returned to the pre-decline peak, which it hit within the third quarter of 2007. The FHFA bases the loan cap on its quarterly Housing Price Index, which gauges average single-family home prices. The index rose 1.5 % while in the third quarter of 2016 and it is up 6.1 % over the past year, enough to push it above its previous high point.

Conforming loan limits are significant because they apply to home loans that meet the underwriting guidelines of Fannie Mae or Freddie Mac, the government-sponsored entities that acquire mortgages from lenders and ensure a steady flow of money to the mortgage market. Home interest rates for nonconforming, or jumbo mortgages, are typically more than rates for loans that come under the cap, and these kinds of mortgages can be harder to acquire.

“Today’s conforming loan limit increase is a much-needed recognition of rising home prices in high-cost markets, and a help to first-time and lower-income borrowers looking to utilize an FHA mortgage,” said NAR President William E. Brown. “Credit remains tight, but this decision will help more qualified buyers address the hurdles and high costs standing between them and the dream of home-ownership.”

Conforming loan limits are higher than the baseline cap in parts of the country where home prices are particularly high, but cannot be more than 150 percent of the baseline limit-$636,150 for 2017-for the contiguous U.S. Exceptions are established for Alaska, Hawaii, Guam, as well as the U.S. Virgin Islands, where loan limits in specific locations may exceed that amount.

Maximum loan limits for 2017 are up in all but 87 counties or county-equivalents in the U.S., in accordance with the FHFA.

Nick & Cindy Davis work with several lenders here in the Tampa Bay area that are ready to assist you with your home purchase. We are always just a click here or call to 813-300-7116 away.

Take a look at a few of the most recent homes that came on the market here in the Tampa Area.

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9123 Otter Pass, Tampa, FL

9123 Otter Pass
Tampa, FL

$179,000
- Lot Size
  
  4,792 sqft
- Home Size
  
  1,040 sqft
- Beds
  
  2 Beds
- Baths
  
  2 Baths
- Year Built
  
  1984
- Days on Market
  
  1
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