2019 vs 2020 Conforming Loan Limits

Home Forums Purchase Program 2019 vs 2020 Conforming Loan Limits

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    @ttrumble Any update on when we could expect the limits to rise from the 2019 ones?


    Weekly bump so Naca addresses this


    FYI I reached out to NACA on Twitter and they responded to me and told me to contact member services. I sent member services an email expressing frustration and asking for answers.
    I think if we want to see any traction we should all contact member services and express our concerns.


    email sent. I think getting through the bureaucracy is going to require a lot of persistence.


    I have also sent an email to member services. If everyone following this thread emails services@naca.com I believe it would go a long way towards showing NACA how important this issue is for its members!


    I did some reading on conforming loan limits yesterday and it only strengthened my belief in my hypothesis that naca is doubling down on their fundamental philosophy of protecting buyers and helping those who need the most help.

    The FHFA sets the conforming limit based on the median value of home sales in the US. So if the median value of home sales across the entire country rises 1% the conforming loan value rises 1%. This is known as the baseline CLL.

    In areas where the median home value is 115% or more of the US median home value a tiered ceiling limit of up to 150% of the baseline CLL is assessed.

    Now here is where it gets interesting. The median value of home sales and thus the baseline CLL jumped up 5.37% from 2019 to 2020 and 7.42% from 2020 to 2021 while income levels increased at just below the standard rate of inflation or around 1.5% (and decreased for many in 2020). So while this is just 2 years and a lot of it can be attributed to the pandemic it is indeed a trend that mimics the trend leading up to the housing bubble burst of 2008 and the drafting of the Dodd-Frank act.

    The unaffordability alone should make you think naca will want to help out. Well those numbers are slightly out of context. There are 3006 counties in this country and 97% of them are NOT considered high cost areas by the FHFA. The median home values are increasing largely due to an astronomical increase in the 3% of high cost areas while the 97% saw a modest increase or even decrease. Here is a link to the map, it looks like red vs. blue politics. https://www.fhfa.gov/DataTools/Tools/Pages/Conforming-Loan-Limits-Map.aspx

    So back to my hypothesis. The largest presence of naca members in any one MSA happens to be in that 97% (Atlanta I think). Also the vast majority of members across the country, including those in high cost areas, fall under the FHFA designation of low to moderate income meaning they would likely never come close to the CLL even with buy down. Add to this the fact that if you can afford a monthly payment of 3000 or a mortgage loan of 800k there is much greater likelihood that you do not absolutely need the services of naca to buy a home.

    So in my mind, with the demand for naca outweighing the supply of services, they are focusing on helping those truly in need in first. Remember, as a private organization, what naca is doing is putting a cap on the value of loans they can counsel for as opposed to simply not following the CLL (slight but important distinction).

    Maybe I’m connecting dots that really aren’t there. But looking at the data, without having any official word, I can see this being part of their decision.


    @ttrumble – ping

    Of course they can set any rules they wish and have any reason or no reason for why they set those rules. I would, however, appreciate more transparency and communication on this topic. They will, at some point, increase the limits and transparency around that process would only help. Also, this doesn’t just affect those people in high cost areas as the baseline limit increased ~$64k everywhere between 2019 and 2021.


    I found his email and got a auto replay hes out until march 1st


    Hi all! I just got re-qualified (and I am through the moon happy)!

    I just did the purchase workshop, (this past Thursday) and we were told that naca is still using the 2019 limits (no explanation was given as to why).

    Does anyone know how to find out if the area I’m living/ buying in is a “high cost area”? I think it is (Nassau county,NY)

    This blog is so helpful!


    Yep. See the link in my post just above from 2/17. It’s 2021 numbers but the map is the same. The 2019 numbers are 50 to 70k lower. I think 484 to 736k are the limits for 2019.


    I see! Thanks Nelson


    How can we get this increased to something more reasonable? Even increasing to 2020 limits would make sense. The LA buyers are having to look at homes that are in the worst parts of town, or so far away that it would take a 2 hour drive just to get to work. I think that not increasing the limits is almost redlining. We deserve to be able to purchase nice homes, in nice areas.


    Sigh, bumping again….


    @ttrumble Any updates?



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