Great news for San Diego home buyers The Federal Housing Administration (FHA) has released a new mortgage loan limit update. The increases go into effect for case numbers assigned on or after January 1, 2017.
Effective immediately, FHA-insured mortgages are now available for loan sizes up to $636,150 for one-unit homes;
FHA loan limits are higher for 2-unit, 3-unit and 4-unit properties;
- One-unit: $636,150
- Two-unit: $814,500
- Three-unit: $984,525
- Four-unit: $1,223,475
It can be confusing, but the FHA is not actually a mortgage lender. Rather, it’s a mortgage loan insurer. The FHA provides insurance, which protects against loss the banks, which make “FHA loans”.
The FHA keeps a book of rules and says, “so long as you make loans that follow these requirements, we will insure those loans against loss.”
FHA-backed loans are often easier for which to qualify than their conforming mortgage counterparts, and come with a number of home buyer-friendly characteristics.
As a few examples of the FHA’s buyer-friendly rules:
- FHA mortgages require a downpayment of just 3.5 percent
- FHA loan downpayment monies can be gifted from a family member
- The minimum credit score requirement for an FHA loan is 500
The FHA is also extremely friendly toward home buyers who have had a recent economic event.
If you are thinking o buying or selling your home in the upcoming year, give me a call 619.980.2738. Or click here I’m here to help!