Great news for homeowners and homebuyers!
The Federal Housing Administration (FHA) announced increased loan limits for 2020, reaching nearly all areas of the country. The new loan limit will be $331,760 for a one-unit property. In areas defined by FHA as ‘high-cost,’ county loan limits may be as high as $765,600 for a one-unit property, which is also an increase from current 2019 limits.
Mostly attributed to robust increases in median housing prices, these limit increases allow consumers to purchase and refinance homes at higher price points with access to the benefits of FHA loan options. These mortgage loans generally carry lower down payment requirements and more flexible credit qualifying standards than conventional financing.
According to the Federal Housing Finance Agency’s (FHFA) seasonally adjusted, expanded-data House Price Index (HPI), house prices increased 5.38 percent, on average, between the third quarters of 2018 and 2019. Therefore, the baseline maximum loan limit in 2020 will increase as well. These new limits will only apply to FHA case numbers assigned as of 1/1/2020.
If you are interested in hearing more about the timing of the change and benefits of FHA loan options, contact an HFG Licensed Mortgage Professional at a location near you.