The Federal Housing Administration announced on Wednesday that it would be raising its loan limits in the new year to keep pace with climbing home prices.
The FHA national loan limit, or floor, will increase from $331,760 to $356,362 for single-family home loans, marking about a $25,000 increase over 2020’s limits. The FHA’s loan limit is set at 65% of the national conforming loan limit of $548,250.
In about 65 high-cost areas of the country, the FHA’s loan limit ceiling will increase even more--from $765,600 to $822,375. High-cost areas are places where 115% of the median home price is greater than the floor (that is, $356,362).
The maximum loan limits for FHA forward mortgages will rise in 3,108 counties, according to the agency. View a complete list of 2021 FHA loan limits.
The new FHA loan limits take effect Jan. 1, 2021.
Last week, the Federal Housing Finance Agency announced it would be increasing annual loan limits by 7.42% in 2021, also in response to higher home prices. In most of the country, the 2021 maximum conforming loan limit for single-family properties will be $548,250. The FHFA’s loan limits define the maximum amount that Fannie and Freddie can finance for a one-unit single-family home. Read more: FHFA Increases Conforming Loan Limits for 2021
Source: HUD.gov
