With home prices climbing back to pre-recession peaks in many U.S. markets, baseline jumbo thresholds may be raised for the first time in a decade.
The agency that sets these limits, the Federal Housing Finance Agency (FHFA), in May requested public input on its house price index.
This index includes sale-price information on government-backed mortgages as well as real-estate sales compiled by research firm CoreLogic from hundreds of U.S. counties.
Distressed sales are included but not appraisal values from refinances.
The deadline for input is July 27, and the FHFA will decide this fall whether to change the baseline limit starting January 1.
In the early 1970s, the baseline limit for conventional loans was just $33,000. That was the maximum amount a homeowner could borrow to qualify for a “conforming” mortgage—one financed by Fannie Mae or Freddie Mac. The $33,000 limit rose steadily over the years to keep up with home prices.
