| FHA Mortgage Rates |
What are the FHA mortgage limits?
(1) the statutory loan limit for the area (typically a county or
metropolitan statistical area (MSA))
(2) the applicable loan-to-value (LTV) limit. Most FHA mortgages
require payment of an upfront mortgage insurance premium
(UFMIP). The statutory loan amount and loan-to-value limits
described in this Handbook do not include the UFMIP. All
descriptions of maximum insurable mortgages throughout this
Handbook, unless otherwise stated, exclude UFMIP.
A. Statutory Loan Amount Limits. The statutory loan amount limits
vary by program and the number of family units within the
dwelling, and apply to both purchases and refinances. For most
programs, they may be increased when housing costs for the
area support higher limits. The National Housing Act specifies the
maximum loan amount for each program. In high-cost areas, the
maximum 203(b) mortgage amount (for a one-unit
property) can be increased by the appropriate HOC to 95 percent
of the median one-family house price in the area or 87 percent of
the Federal Home Loan Mortgage Corporation (Freddie Mac) limit,
whichever is less.
Higher limits are available in Hawaii, Alaska, Guam, and Virgin
Islands but must be justified by local house prices.
The current FHA standard and high-cost area mortgage limits can
be accessed from the lender Web page on HUD’s Web site at
www.hud.gov
or on FHA Connection at https://entp.hud.gov/clas/. A Mortgagee
Letter is also issued each year announcing the new mortgage
limits. The standard area-wide mortgage limits and the maximum
high-cost limits are indexed to the Freddie Mac conforming loan
limit. Therefore, as the conventional conforming loan limits
increase, the FHA loan limits alsoincrease.
B. Loan-to-Value Limitations.
The mortgage insurance program, whether the loan is for the
purchase of a property or for the refinance of an existing debt,
the age of the property, and several additional criteria (as per
paragraph 1-8) are used to determine the maximum LTV
percentage available to the borrower. This LTV percentage is then
applied to the lesser of the sales price or the appraised
value
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