Loan limits are increasing in 2020. What does that mean? First, there’s a difference between your purchase price and your loan limits. For instance, conventional loans have increased; in 2019 the limit was $484,000, and in 2020, the limit is $510,400. That’s over a 5% boost in just one year.
If you don’t have the 20% down for a conventional loan, an FHA product is an excellent option. It’s 3.5% down and those limits are increasing, too. In 2019, they were $339,250. In 2020 they are $356,500, a 5% escalation. This helps your buying power when you’re purchasing a new home with an FHA loan.
Finally, let’s talk about the VA product. The VA loan limits have had a 247% increase from last year. In 2019, the limit was $484,350. In 2020, it is $1.2 million (that’s 100% financing up to $1.2 million)! That also works if you have multiple VA houses, meaning you can go up to that number collectively.
One thing to think about with VA loans: They allow up to $1.2 million, but not every bank will allow that high of a number. Check with your loan officer to confirm they have the product to get you all the way to $1.2 million.
If you’re in the market and you’re looking to buy in 2020, go explore your options with your local lender. Happy home hunting!
If you have any questions for us about loan limits, please don’t hesitate to reach out by phone or email. We would love to help you!