What does this mean for homebuyers? They’ll have more home choices with a low down payment loan.
On Wednesday, December 2, HousingWire reported that the Federal Housing Administration announced new 2021 limits for FHA loans. The new single-unit property minimum limit of $356,362 is an increase of almost $25,000 from 2020’s limit of $331,760. The minimum limit is set at 65% of the national conforming loan limit, recently announced at $548,250 for 2021.
For high-cost areas, where the median home value exceeds the minimum limit by more than 115%, the maximum loan limit will be higher. The Housing and Economic Recovery Act of 2008 established the maximum loan limit in those areas at 150% of the national conforming loan limit. So, the 2021 high-cost area FHA loan limit for single-unit properties will be as high as $822,375 in some areas. You can look up the FHA’s mortgage limit in your area here.
For borrowers, this means more homes can possibly be financed with a down payment as low as 3.5%. FHA loans are a real plus for first-time homebuyers, credit-challenged homebuyers, and anyone who hasn’t saved a larger amount for a down payment.
As more buyers have access to affordable loans at historically low interest rates in 2021, CrossCountry Mortgage will be there for them. Contact your trusted CCM loan officer today to get ready to take advantage of these new loan limits. We’re here to help!