Pennymac increases its conforming loan limit to $802,650
In what has become a familiar fall ritual, mortgage lenders increase their conforming loan limits months before the FHFA’s official announcement. On Friday, Rocket Pro TPO And Pennymac both announced an increase in their conforming loan limits to $802,650 – ahead of the expected increase by the FHFA in November. Rocket’s increase took effect on Friday and Pennymac’s increase will take effect for new broker closes on Monday, September 16.
Alaska and Hawaii continue to see a larger increase under the new lender guidelines, with a new loan limit at both lenders of $1,203,975. FHFA’s 2024 conforming loan limits are $766,550 for the bottom 48 and $1,149,825 for Alaska and Hawaii. The new threshold announced by lenders is an increase of 4.71% over this year’s conforming credit limit. The FHFA will not announce this official conforming loan limit for 2025 until November.
In 2008, as a result of the major financial crisisthe Housing and Economic Recovery Act (HERA) established a formula that required the conforming loan limit to increase only after home prices returned to pre-recession levels. That requirement was finally met in 2016 when the FHFA raised the compliant limits for the first time in a decade.
Here are the increases to the FHFA conforming loan limit for single-unit loans for the lower 48 states since 2016.
- 2016: $417,000
- 2017: $424,100 – up 1.7%
- 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 credit limit has increased by 50.1% since 2020, reflecting the sharp rise in home prices in the wake of the pandemic.
