The Federal Housing Finance Agency (FHFA) today announced the conforming loan limit values for mortgages acquired by Fannie Mae and Freddie Mac (the Enterprises) in 2025. The conforming loan limit is $806,500 on one-unit properties and a cap of $1,209,750 in high-cost areas. The previous loan limits were $766,550 and $1,149,825, respectively.

The conforming loan limit determines the maximum size of a mortgage that government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac can buy or "guarantee." Non-conforming or "jumbo loans" typically have tighter underwriting standards and sometimes carry higher mortgage interest rates than conforming loans, increasing monthly payments and hampering the ability of families in California to purchase homes by making them less affordable.

C.A.R. and NAR both have long advocated for loan limits that reflect an area's cost of housing. As a result of C.A.R.'s and NAR's efforts, areas with high median home prices have benefited from a loan limit above the national conforming loan limit.

November 26, 2024

Article belongs to CAr.org