A higher loan cap and lower rate mean more buying power for your next home.
Did you hear the good news? There are two exciting developments in the real estate market: a drop in mortgage rates and an increase in the jumbo loan limit. These changes are great for homebuyers and sellers, creating a window of opportunity for those looking to enter the market.
Falling mortgage rates. This scenario opens the door for more buyers to afford their dream homes. Back in November 2023, 30-year rates peaked at 8%. Fast forward to today, they are now hovering just above 6%, while 15-year rates are slightly exceeding 5%. This rate reduction is largely because of the recent Federal Reserve rate cut.
Looking ahead, the Fed is expected to lower rates again after the election and into early 2025. While it’s uncertain whether mortgage rates will continue to drop, real estate financial experts predict rates may hold steady or potentially decrease by another half percentage point.
“This change means increased buying power for those looking to purchase higher-priced homes.”
Jumbo loan limit increase. This limit determines the maximum loan amount eligible for financing. Previously set at $766,550, this limit is now rising to $802,650. This change means increased buying power for potential buyers, particularly those looking to purchase higher-priced homes.
However, it’s essential to understand how this affects your financing options. Jumbo loans typically come with stricter qualification requirements, larger down payments, and higher interest rates. For instance, conventional loans only require a 3% to 5% down payment if your loan falls under the conforming limit. On the other hand, jumbo loans require at least a 20% down payment.
Now is the time to explore your options and make informed decisions about your next move in the market. If you have any questions or want to discuss how these changes can benefit you, feel free to contact me at [email protected]. I’m here to help you find the best opportunities in today’s market.