What are FHA loans limits? This are loan limits insured by the Federal government under FHA (Federal Housing Administration) management and control. Mortgage lender from a private sector provides the funding. The government gives out insurance to the lender, whereby the insurance covers the losses in case of borrower default event. There are limits you can borrow from FHA program. In addition the FHA limits vary in each county.
FHA sets up loans limit each financial year. The loans limits are updated annually after calculations are done. Fannie Mae and Freddie Mac are known to influence the loan limits decisions. This influence is derived from conventional loan limits set by them. Here is a video showing the loan limits for 2016.
The value worth of 115% of the media price in each year is used to calculate annually loan limits by FHA. The loan limits are then released on 1, January each year. You can observe the loan limits set for each of the 188 counties in each year at the FHA website. Every year the Department of Housing and Urban Development (HUD) determines the maximum amount of mortgage the FHA is allowed to insure. If you choose to get an FHA Loan, we recommend this FHA loans company. The maximum mortgage amount that can be insured is 115% of the media price value worth. According to HUD, the loan limits for counties located in MSAs (Metropolitan Statistical Areas) should be calculated based on the highest cost county.
This year (2016) loan limits, were released on Wednesday 10 Dec last year. The loans limit for the 188 counties were increased. Some areas that are experience loon limits increase this year include;
a) San Diego County- California. A single family unit loan limit increased from $562,350 to $580,750 as compared to previous year.
b) Suffolk County- Massachusetts, wherein loan limits increased from $517,500 to $523,250 as compared to previous year.
c) Mecklenburg County- North Carolina-The loan limits rose from $271,050 to $217,050
Loan limits for the year 2017 are not yet released. Over the last year, the loan limits have risen steadily. Currently median home value, in some counties is higher a bit than FHA loan limits set in the same counties. Will FHA loans increase in 2017? That is the question lingering in majority of the peoples mind. As it is always the tradition, in December the HUD is expected to announce the maximum amount of mortgage the FHA is supposed to insure in 2017. Since the prices has risen a bit over the years, there is a possibility the loan limits might be higher 2017.
On November 23, 2016 Federal Housing Finance Agency (FHFA) announced that for year 2017 loan limits for the single- family unit will be increased from $417,000 to $424,100. This decision was influenced by Fannie Mae and Freddie Mac conventional loan limits.