How Do Changes in the Conforming Loan Limits Affect You and Your Interest Rate?
Each year at this time (December), the conforming loan limits are re-set by The Housing and Economic Recovery Act and designated by county. To make this easy to understand, most counties assign a new limit based on the change in the average U.S. home price during that year. Those new limits go into effect on January 1st, meaning we can start locking loans now utilizing those new limits.
Very simply, the conforming loan limit in Los Angeles County for 2019-2020 has been $510,400, meaning that if your loan was $510,400 or lower, you received the best rates possible (assuming several factors and qualification). Beginning with loans closing after Jan. 1, that limit has just been raised to $548,250. So, for borrowers who recently or over the last year or two refinanced or purchased a home with a loan of higher than $510,400, you are now within the conforming loan limits and may have an opportunity to refinance at a lower rate than you have!
Once you exceed the conforming loan level, you are in the “High Balance” bracket, meaning that the risk is a bit higher and thus, your rate is higher. The high balance limit in 2019-2020 has been $765,600. As of Jan. 1, that new limit will be $822,375. Again, if your loan was higher than $765,600, you may now qualify for a lower rate!
For those of you who are in the loan level ranges I discussed, give me a call as I can potentially offer you an even better rate than you have and save you a lot of money over the life of your loan! And…for those who may be considering a cash out refinance which would have exceeded the current loan limits, you may be surprised to find that you can now accomplish your goals with these NEW LIMITS! Don’t miss out on this opportunity that few borrowers know about! Give me a call at 661-705-2500. This is my 35th year serving Santa Claritan’s and I am proud to be in the TOP 1% of Loan Originators Nationwide year after year! But Curt Kravitz is even more proud of having helped the thousands of clients he has had the privilege of working with over the years. Happy Holidays and Happy New Year!
Call today and see how Curt can get you a better rate: (661) 705-2500, or visit the website for more information: www.bayequityhomeloans.com/curt-kravitz/
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