In what has become a familiar fall ritual, mortgage lenders are increasing their conforming loan limits months ahead of the FHFA’s official announcement. On Friday, Rocket Pro TPO and Pennymac both announced an increase in their conforming loan limits to $802,650 — before the expected increase by the FHFA in November. Rocket’s increase was effective Friday and Pennymac’s increase will be effective for new broker locks on Monday, Sept. 16.
Alaska and Hawaii continue to get a bigger increase under the lenders’ new guidelines, with a new loan limit at both lenders of $1,203,975. FHFA’s conforming loan limits for 2024 are $766,550 for the lower 48 and $1,149,825 for Alaska and Hawaii. The new threshold announced by lenders is a 4.71% increase over this year’s conforming loan limit. The FHFA will not announce its official conforming loan limit for 2025 until November.
In 2008, as a result of the great financial crisis, the Housing and Economic Recovery Act (HERA) established a formula which mandated that the conforming loan limit could only rise after home prices returned to pre-recession levels. That condition was finally met in 2016 when the FHFA increased the conforming limits for the first time in a decade.
Here are the increases in FHFA’s conforming loan limit for one-unit loans for the lower 48 states since 2016.
- 2016: $417,000
- 2017: $424,100 — 1.7% increase
- 2018: $453,100 — 6.8% increase
- 2019: $484,350 — 6.8% increase
- 2020: $510,400 — 5.3% increase
- 2021: $548,250 — 7.4% increase
- 2022: $647,200 — 18% increase
- 2023: $726,200 — 12.2% increase
- 2024: $766,550 — 5.5% increase
The conforming loan limit has increased 50.1% since 2020, mirroring the sharp increase in home prices in the aftermath of the pandemic.
