HUD Announces Higher FHA Loan Limits for 2019
That is an increase from 2018 when the limit was set at $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.
Many areas of the country will see an increase in FHA loan limits for 2019; maximum loan limits for FHA forward mortgages will rise in more than 3,000 counties nationwide.
What about high-cost areas? In these counties, the FHA loan limit ceiling for 2019 goes up to $726,525. That is an increase from 2018’s $679,650. The FHA floor goes up to $314,827 from $294,515.
In only 181 counties across the nation, FHA loan limits remain unchanged in 2019.
According to the FHA and HUD, “...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” following the implementation of the Housing and Economic Recovery Act or HERA.
HERA amended the National Housing Act, and as a result of that amendment FHA must establish an FHA loan limit floor and ceiling. Those limits are 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 the county where the property to be purchased is situated.
FHA home loan limits are not the same for all properties-a single unit home has a limit lower than for a property with four units; FHA mortgage loans for single family residences are possible for homes that have between one and four living units.
FHA mortgage loans are for owner/occupiers and an occupancy requirement exists for all forward FHA loans as a condition of loan approval. Ask your lender about this requirement if you aren’t sure how it applies to your transaction.
Home Equity Can Secure Your Second Mortgage
Consider the Advantages of Discount Points
FHA Limits are Calculated and Updated Annually
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