It Just Got a Bit Easier to Buy a Higher-Priced Home
The limits on conforming home loans have risen for the first time in 10 years.
Home prices rebounded nationally by late fall to levels last seen in 2007, when the housing bust began. In response, the Federal Housing Finance Agency has increased the maximum limit for conforming loans backed by Fannie Mae and Freddie Mac for the first time in 10 years—from $417,000 to $424,100 in most of the U.S. In areas with the priciest homes, such as New York City and San Francisco, the limit for super-conforming loans rises from $625,500 to $636,150. (Special limits apply in Alaska, Hawaii, Guam and the U.S. Virgin Islands.)
The difference between average interest rates for conforming loans and jumbo loans nationwide is negligible (recently 4.41% versus 4.36%, according to the Mortgage Bankers Association). But lenders usually require a minimum FICO credit score of 740 and 5% down for a conforming loan, versus 760 and a down payment of 20% to get a private jumbo, says Keith Gumbinger, of HSH.com, which follows mortgage and home-equity trends.
Even if you qualify for a conforming loan, if you put down less than 20%, you’ll still have to pay private mortgage insurance (PMI). And beginning in 2017, you can no longer deduct the cost of PMI on your tax return if you itemize.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.
-
Stock Market Today: Nasdaq Nabs New High After Jobs Data
The S&P 500 also closed at its highest level ever, while the Dow Jones Industrial Average was pressured by another down day for UnitedHealth stock.
By Karee Venema Published
-
Rebound in Jobs Growth Keeps Fed on Track: What the Experts Are Saying
Jobs Report No nasty surprises in the November payrolls data leaves a quarter-point cut in play.
By Dan Burrows Published
-
Roth IRA Contribution Limits for 2024 and 2025
Roth IRAs Roth IRA contribution limits have gone up. Here's what you need to know.
By Jackie Stewart Last updated
-
How to Find Foreclosed Homes: Best Foreclosure Listings Sites
Making Your Money Last Find foreclosed homes for sale on these foreclosure listing websites. Search for properties on these free, paid or government sites.
By Bob Niedt Last updated
-
Luxury Home Prices Rise as the Rich Dodge High Mortgage Rates
Luxury home prices rose 9% to the highest third-quarter level on record, Redfin reports, growing nearly three times faster than non-luxury prices.
By Kathryn Pomroy Published
-
Four Tips for Renting Out Your Home on Airbnb
real estate Here's what you should know before listing your home on Airbnb.
By Miriam Cross Published
-
Five Ways to a Cheap Last-Minute Vacation
Travel It is possible to pull off a cheap last-minute vacation. Here are some tips to make it happen.
By Vaishali Varu Last updated
-
How to Figure Out How Much Life Insurance You Need
insurance Instead of relying on rules of thumb, you’re better off taking a systematic approach to figuring your life insurance needs.
By Kimberly Lankford Last updated
-
Amazon Big Deal Days Is Coming! We’ve Got All the Details
Amazon Prime To kick off the holiday season with a bang, Amazon Big Deal Days runs Tuesday, October 8 and Wednesday, October 9.
By Bob Niedt Last updated
-
How to Shop for Life Insurance in 3 Easy Steps
insurance Shopping for life insurance? You may be able to estimate how much you need online, but that's just the start of your search.
By Kaitlin Pitsker Published