December 20, 2018
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 in more than 3,000 counties.
In 181 counties in the USA, FHA loan limits will remain unchanged. According to the press release, “By statute, the median home price for a Metropolitan Statistical Area (MSA) is based on the county within the MSA having the highest median price. It has been HUD’s long-standing practice to utilize the highest median price point for any year since the enactment of the Housing and Economic Recovery Act” (HERA).
High-cost areas will see the FHA loan limit ceiling will increase to $726,525, up from from $679,650. The FHA floor goes up to $314,827 from $294,515.
There are high-cost areas, and then there are also areas (Alaska, Guam, Hawaii, and the Virgin Island) that have higher FHA loan limits as “exception areas” due to elevated costs of construction and home prices.
The HERA-amended National Housing Act requires FHA to establish its floor and ceiling loan limits based on the loan limit set by the Federal Housing Finance Agency for conventional mortgages owned or guaranteed by Fannie Mae and Freddie Mac.
FHA loan limits vary by county and are not the same in all areas. Borrowers should discuss their FHA loan limits questions with a loan officer to determine how much home loan they are eligible for in 2019 based on location.
The FHA loan limits announced here and on the FHA/HUD official site are good for case numbers issued on or after 1 January, 2019. Until then, current FHA loan limits apply.
Bruce Reichstein has spent over three decades as an experienced FHA and VA home loan mortgage banker and underwriter where he was responsible for funding “Billions” in government backed mortgage loans. He is the Managing Editor for FHANewsblog.com where he educates homeowners on the specific guidelines for obtaining FHA guaranteed home loans.
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