Articles in Category: Loan Limits

December 20, 2018

FHA and HUD Announce Higher FHA Loan Limits For 2019

The FHA and HUD have announced higher FHA home loan limits for 2019. The higher loan limits come in part thanks to “robust increases in median housing prices” according to the FHA/HUD official site. Nationwide, the limit for “average” housing markets is set in 2019 at $314,827, an increase from 2018’s limit of $294,515. The FHA is required by the National Housing Act (and amendments to that act passed in 2008) to establish FHA forward loan limits “at 115 percent of median house prices”, which include both a “floor” and a “ceiling” on those yearly limits. No FHA loan limits have gone down for 2019. For 2019, most areas of the country will see an increase. The FHA/HUD press release states maximum loan limits for FHA forward mortgages will rise | more...

December 19, 2018

What You Need To Know About FHA Loan Limits For 2019

By Joe Wallace

FHA loan limits for 2019 will be higher than for 2018. We will cover the specifics of this news in another blog post, but there are some basics first-time home buyers should know about FHA loan limits that will help save time in the loan preparation process. FHA Home Loan Limits For 2019 Are Higher For Every Type Of Property Available To Buy With An FHA Mortgage Single family homes can be many things; condo units, duplexes, multi-unit properties, mobile homes, etc. No matter what property type you wish to purchase with an FHA mortgage loan, the FHA loan limits for 2019 have increased. One of the most important factors in determining your FHA loan limit in the new year is your location, rather than whether you want to buy | more...

June 11, 2018

FHA Loan-To-Value Limits: More Rules You Should Know

By Bruce Reichstein

In a previous blog post, we discussed some of the basic loan-to-value ratio rules (LTV) for FHA loans. Your loan-to-value ratio is calculated based on the amount of the required down payment a borrower has to make as part of the FHA mortgage loan transaction. When you buy a home using an FHA mortgage, the loan-to-value ratio can be affected by your FICO scores. A higher down payment requirement means a different LTV than for those who make the lowest possible downpayment on an FHA mortgage loan of 3.5% of the adjusted value of the property. But credit score issues aren’t the only things that can affect a borrower’s LTV on an FHA mortgage to buy a new home. Some FHA loan transactions, under FHA loan policy, require as much | more...

June 11, 2018

FHA Home Loans and Loan-To-Value Limits: Rules You Should Know

By Joe Wallace

FHA home loans have limits on the amount of the loan, how much of the loan the FHA will guarantee, and the loan-to-value ratio or LTV. The LTV of your home loan is basically the percentage of the mortgage compared to the value of the property. There’s an loan-to-value calculation required in part because the borrower is required in most cases to make a minimum down payment for “forward mortgages”. These down payments are not required by FHA loan rules for FHA rehab loans to fix or replace qualifying homes in federally-declared disaster areas, but for all other new purchase FHA loans, the borrower will be required to make a minimum down payment. FHA loan rules in HUD 4000.1 spell out the requirements for this down payment and calculating the | more...

January 8, 2018

How Much Can I Borrow With An FHA Mortgage In 2018?

By Bruce Reichstein

How much can I borrow with an FHA mortgage in 2018? There’s no single answer to this question for a variety of reasons, but in general there are things you should know about an FHA mortgage that can help you understand how much you are able to borrow to buy a home. FHA Loan Limits Are Set By County FHA loan limits are broken down by county in each state. You can see a good example of this and learn what the FHA limit for your area is for the current year, but it is important to note that the dollar amounts you see are calculated before add-ons to the loan such as mortgage insurance premius, FHA Energy Efficient Mortgages, etc. In other words, your loan limit is calculated with the | more...

December 8, 2017

Higher FHA Loan Limits For 2018

By Bruce Reichstein

The FHA has announced FHA loan limits for 2018, and the new numbers mean good news for those looking to buy a home in the new year. The “national conforming loan limit” for 2018 is set at $453,100, up from last year’s limit of $424,100 (see below). The higher limit means more potential borrowing power for qualified FHA loan applicants. According to the announcement on the FHA official site, there are higher limits for 2018. The Federal Housing Administration calculates “forward mortgage limits based on the median house prices in accordance with the National Housing Act. FHA’s Single Family forward mortgage limits are set by Metropolitan Statistical Area (MSA) and county and are published periodically.” The FHA sets loan limits “at or between the low cost area and high cost | more...

November 24, 2017

Late or Missed Payments and FHA Loan Applications

By Joe Wallace

Is it possible to get an FHA loan application approved with late or missed payments on your credit report? It’s easy to get caught up in a struggle with common financial problems, and some of the simplest situations (late and missed payments on financial obligations) can have the biggest impact on a borrower’s credit rating or perceptions of creditworthiness. Having a handful “lates” and/or missed payments in your recent credit history might not affect your overall financial bottom line IF you’re not planning to seek new lines of credit. But if you are planning to apply for a home loan in the 12 months following late or missed payments, this situation becomes far more important. FHA loan applications, like other major lines of credit, are affected by anything that changes | more...

October 10, 2017

What Are The FHA Loan Rules For Maximum Loan Amounts?

By Bruce Reichstein

What are the FHA loan rules for maximum loan amounts? It’s an important question many borrowers need to know when looking for homes; knowing how much you can borrow is an important factor in budgeting and planning for your FHA loan. FHA Loan Maximum Mortgage Amounts Defined HUD 4000.1, the FHA loan handbook, describes FHA loan maximum mortgage amounts as follows: “A Mortgage that is to be insured by FHA cannot exceed the Nationwide Mortgage Limits, the nationwide area mortgage limit, or the maximum Loan-to-Value (LTV) ratio. The maximum LTV ratios vary depending upon the type of Borrower, type of transaction (purchase or refinance), program type, and stage of construction.” For most FHA loans, the maximum mortgage an applicant is eligible for involves “the lesser of the Nationwide Mortgage Limit | more...

September 7, 2017

Do FHA Home Loan Limits Change?

By Bruce Reichstein

Do FHA home loan limits change? Borrowers who want to know what the FHA loan limits for a given housing market might be have to contend with the possibility of changing limits depending on what time of year they are house hunting. How FHA Loan Limits Work The Federal Housing Administration calculates new purchase mortgage loan limits based on “the median house prices in accordance with the National Housing Act” according to the FHA official site. “FHA’s Single Family forward mortgage limits are set by Metropolitan Statistical Area (MSA) and county and are published periodically.” FHA publishes updated home loan limits for forward mortgages and reverse mortgages on a yearly basis. The FHA official site states, “FHA sets these limits at or between the low cost area and high cost | more...

July 31, 2017

What Is An FHA Loan Limit? Part Two

By Joe Wallace

What Is An FHA Loan Limit? We’ve been exploring this question-in our previous blog post we looked at the basics of FHA loan limits. According to the FHA/HUD official site, “The maximum mortgage amount that FHA will insure on a specific purchase is calculated by multiplying the appropriate LTV percentage by the Adjusted Value. In order for FHA to insure this maximum mortgage amount, the Borrower must make a Minimum Required Investment (MRI) of at least 3.5 percent of the Adjusted Value.” FHA loan limits are set by the National Housing Act and will vary depending on the housing market. Some areas are low-cost markets, some are high-cost, and others are simply “average”. But what does that mean for the typical FHA loan applicant? The FHA loan handbook, HUD 4000.1, | more...