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Conventional Loan Limit Increase

January 6,2021

Virginia Housing is accepting conventional loan applications at the new increased conforming loan limit of $548,250. Certain restrictions apply, see below.

Effective Date

This is effective in Mortgage Cadence with loan applications on or after January 1, 2021. If you have a loan in process with a loan amount above the previous conforming loan limit but does not exceed $548,250 with an application date prior to January 1, 2021 that has not been purchased yet by Virginia Housing, please contact Melissa Whitlow for assistance (Melissa.Whitlow@VirginiaHousing.com).

Important to remember!

The Virginia Housing Sales Price Limits have not changed. That means when a conventional loan has a Plus Second, DPA Grant, and/or MCC the sales price limits apply, which typically are more restrictive. It is only when a conventional loan is originated without a Virginia Housing Specialty Program that the sales price limits do not apply. Below are some examples.

Example 1

  • Conventional with DPA Grant and MCC
  • Sales Price $550,000
  • Loan amount $533,500
  • Prince William County (not targeted area)

 

Is this acceptable?

No, because the sales price is above the Washington-Arlington-Alexandria area limit of $525,000 that applies due to the Grant/MCC.

Example 2

  • Conventional
  • Sales Price $550,000
  • Loan amount $533,500
  • Newport News City (not targeted area)

 

Is this acceptable?

Yes, because the sales price limit of $390,000 does not apply when there is no specialty program and the loan amount is within the conforming limit.

Example 3

  • Conventional with Plus Second Mortgage and MCC
  • Sales Price $440,000
  • Loan amount $426,800
  • Chesterfield County (not targeted area)

 

Is this acceptable?

No, because the sales price limit is above the Richmond area limit of $425,000 that applies due to the Plus Second Mortgage and MCC.