The Federal Housing Finance Agency (FHFA) recently announced the 2022 conforming loan limits and, to no one's surprise, loan limits have increased significantly to $647,200 in most areas of the country. The 18% increase is the largest year-over-year jump in loan limits in recent history.
2022 Conforming Loan Limits California is $647,200 and goes up to $970,800 for high-cost counties for one-unit properties. 2022 Conforming Loan Limits California for 2-unit properties is $828,700 and goes up to $1,243,050 for high-cost counties.
Conforming loan limits increased to $647,200 for most of the U.S., which means you may be able to avoid the stricter requirements of a jumbo loan. Many or all of the products featured here are from our partners who compensate us.
Washington, D.C. – The Federal Housing Finance Agency (FHFA) today announced the conforming loan limits (CLLs) for mortgages to be acquired by Fannie Mae and Freddie Mac (the Enterprises) in 2022. In most of the U.S., the 2022 CLL for one-unit properties will be $647,200, an increase of $98,950 from $548,250 in 2021.
The maximum limit for one-unit properties in approximately 70 high-cost counties has been raised to $970,800, up from $822,375 in 2021. Keep in mind, the Federal Housing Finance Agency may increase conforming loan limits again for 2023.
A jumbo loan or 'jumbo mortgage' is any home loan that exceeds the limits for a conventional conforming loan. In 2022, a jumbo loan is a mortgage bigger than $647,200 in most areas (though loan limits are higher in more expensive counties).
The Federal Housing Administration (FHA) just announced relief for those hoping to buy a home this year. As of January 1, 2022, the loan limits for FHA-backed loans will rise 18%—a record increase—to reflect the market and allow qualified buyers to continue to access affordable home financing.
What is the Jumbo Loan Limit in 2022? In 2022, any loan exceeding $647,200 falls under the jumbo category. However, there are exceptions in certain counties within California. If you live in a high-cost county, the 2022 California conforming loan limits are higher.
2021 Conforming Limit California is $548,250 and goes up to $822,375 for high-cost counties for one-unit properties. 2021 Conforming Limit California for 2-unit properties is $702,000 and goes up to $1,053,000 for high-cost counties.
In 2021, the conforming loan limit is $548,250 in most counties in the U.S., and $822,375 in higher-cost areas. Any mortgage over these amounts is considered a jumbo loan.
Jumbo mortgages are large loans that fall above the federal loan limit. These loans are typically harder to qualify for than conforming loans, but they can offer competitive interest rates. They're also a convenient way for borrowers to secure the money they need to purchase expensive homes.
Now, if you can support the debt, the maximum residential mortgage loan you can get with a stellar financial profile is (drum roll, please): $3 million. Yes, you read that right. That's a three with six zeroes behind it, and you're going to have to meet some lofty credit requirements to get it.
The baseline conforming loan limit for 2022 is $647,200 – up from $548,250 in 2021. The limit is higher in areas where the median house cost exceeds this number, so borrowers in high-cost areas can get conforming loans of up to $970,800 depending on the limit in their individual county.
About jumbo loans
A loan is considered jumbo if the amount of the mortgage exceeds loan-servicing limits set by Fannie Mae and Freddie Mac — currently $647,200 for a single-family home in all states (except Hawaii and Alaska and a few federally designated high-cost markets, where the limit is $970,800).
Larger Down Payment
One simple way to avoid using a jumbo mortgage is to make a bigger down payment. You only need to come up with enough money to keep the loan balance below your local conforming loan limit. With that approach, you have more options available, and you will pay less interest on a smaller loan balance.
Any loan that exceeds $970,800 is considered a jumbo loan. Individual counties such as Solano County and San Joaquin county have lower jumbo loan limits.
Another additional requirement for jumbo loans which could delay closing is home appraisals—some jumbo loans require 2 appraisals. A jumbo loan for more than $2M automatically requires 2 home appraisals. Jumbo loans for more than $1.5M may also require 2 home appraisals.
“Jumbo rates are less dependent on secondary market pricing because they aren't packaged into mortgage-backed securities as often.” What's more, jumbo lenders tend to be quite picky about the creditworthiness of jumbo borrowers.
What's changing? This year, the FHA plans to impose a minimum credit score requirement: 500. Borrowers with credit scores below 580 would have to make a down payment of at least 10 percent instead of the usual 3.5 percent minimum.
2022 FHA Loan Limits Arizona is $420,680 and goes up to $441,600 for high-cost counties for one-unit properties. 2022 FHA Loan Limits AZ for 2-unit properties is $538,650 and goes up to $565,300 for high-cost counties.
The Federal Housing Administration doesn't want borrowers taking out multiple FHA loans – and benefitting from less stringent requirements — to purchase investment properties instead of fulltime homes. While you can apply for multiple FHA loans in your lifetime, you can usually only have one at a time.
Jumbo loan rates
The rates on jumbo mortgages fluctuate and can be higher or lower than the conforming mortgage rate. Currently, the average 30-year jumbo APR for a home purchase is 5.780%, while the average 30-year conforming loan APR for a purchase is 5.820%, according to Bankrate's survey of mortgage lenders.
Yes, jumbo mortgage rates tend to be higher than interest rates on conforming mortgages because they can't be purchased by Fannie Mae and Freddie Mac. Fewer buyers means less liquidity and higher interest rates.
Conventional Loan Requirements
It's recommended you have a credit score of 620 or higher when you apply for a conventional loan. If your score is below 620, lenders either won't be able to approve your loan or may be required to offer you a higher interest rate, which can result in higher monthly payments.
Most conventional mortgages meet Fannie Mae and Freddie Mac requirements and are considered conforming, but nonconforming loans such as jumbo mortgages are also considered conventional.