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Just Announced! Maximum Conforming Conventional Loan Limit increased for 2021! $548,250

Updated: Jun 15

The Federal Housing Finance Agency (FHFA) has just released the new conforming loan limit for 2021: $548,250.


This is the 5th year in a row that the conforming conventional loan limit has increased. According to FHFA data, home prices increased 7.42 percent (on average) from Q3 2019 to Q3 2020; therefore, the conforming loan limit for 2021 has been increased by 7.42 percent.


The new loan limit of $548,250, provides an extra $37,850 of financing to conventional borrowers in 2021.


There are many areas throughout the US where averages home values are significantly higher. In these counties, the maximum conforming loan limit is calculated based on the median home value in that area. Median home values in almost all areas have increased in 2020, resulting in higher maximum loan limits for 2021. In fact, all but 18 counties have a higher conventional loan limit for 2021. The uppermost cap for conventional loans, even the highest cost areas like Hawaii and Alaska, is 150% of the baseline loan limit, or $822,375 for 2021.


Does the conforming conventional loan limit increase every year?

Annual increases in the loan limit may seem like a given in the more recent mortgage market, but prior to 2016 the baseline conforming loan limit had held steady for more than 8 years. It was initially set at $417,000 by the housing and economic recovery act of 2008. This act required that after a period of declines, the loan limit was not permitted to be raised until prices returned to pre-decline levels. The first limit increase was in 2016, which upped the limit by $7,100. Each year since we have been fortunate to see an increase, which have raised the baseline by more than $130,000.


What does an increased conventional conforming loan limit mean for you?

In 2021 you will be able to utilize a conventional loan for loan amounts as high as $548,250. With 20% down, this puts the purchase price just over $650,000. While Jumbo loans are also an option when you are looking for a larger loan, conventional loans are often more cost effective. Conventional loans tend to have lower interest rates and closing costs combined with a more simplified, speedier loan process.


When can I take advantage of a larger conventional loan?

TODAY! These new limits are applicable as soon as they are signed off on, meaning you can begin taking advantage of the higher loan limits today!


Ready to purchase your dream home?

Call the mortgage experts at Simplicity Mortgage today and we'll help find you the best loan for your home!


Simplicity Mortgage is a mortgage brokerage

located on Dulawton Avenue in Port Orange, FL.


Simplicity works with borrowers looking for for home financing in all areas of Florida area. Our service area includes Volusia and Flagler counties, Palm Coast, Ormond Beach, Ormond by the Sea, Deland, Daytona Beach, Daytona Beach Shores, Port Orange, Ponce Inlet, New Smyrna Beach, Orlando, Jacksonville and all surrounding areas of Florida.


Our portfolio consists of 20 or more lending institutions, which makes it easy for us to find the most optimal financing option for a clients specific financial scenario.


Our goal is to provide a easy and painless customer experience coupled with an low rate and minimal fees. We are your point of contact throughout the process. We provide customers with a variety of loan products: Conventional, VA loan, FHA loan, USDA, Jumbo, Non Qualified Mortgage (non-QM), Self Employed, 1099, first time home buyer, investment, and secondary property purchases. We have outstanding options for your refinance as well, IRRRL, Home Equity Loan, Streamline Refinance, Cash Out, Rate and Term. Call Simplicity today to discuss your purchase or refinance. We will utilize our home loan calculator to determine your future mortgage payment with several mortgage rates to help you determine the most beneficial mortgage option for your next home loan.