FHA Loan Limits

Since 1934, the FHA has helped make homeownership a reality for millions of Americans and their families by extending really great benefits to people who would not otherwise be able to afford a new house. These benefits have made the entire loan process much simpler and more affordable than conventional loans.

While the FHA makes mortgages much more affordable for low and middle-income American families, there is a limit on how much they are willing to insure for you. The limit on how much you can borrow depends on a few different factors, such as your credit score, debt-to-income ratio and the county’s loan limit.

Credit Score

All lenders require you to submit your credit score for evaluation, and the FHA is no different. How much you can qualify for will depend partly on your credit rating. However, the FHA is much more lenient than private lenders when it comes to your credit score. If you have a low or no credit score, you may still be able to qualify for a good loan when done through the FHA. Even if you have had a bankruptcy in your past, the FHA is willing to work with you to get you approved for your home loan.

Debt-to-income Ratio

Your debt-to-income ratio takes into consideration your monthly or annual salary, and then subtracts all your monthly bills. These bills include car payments, other mortgages, tuition, utilities, groceries, etc. The lender takes this number to see how much money you have leftover at the end of each month, which is the most you will be able to afford for a mortgage. You won’t be able to qualify for a big loan if you are barely making ends meet at the end of the month.

Loan Limits

The FHA sets a limit on how much they will insure which varies from county to county. They also take into consideration the size of your family, so a single house will have a much lower limit than a five-family home in the same county. To find out your county’s loan limit, visit the US Department of Housing and Urban Development website.

Getting Pre-approved

You can also find out how much you will be able to borrow by getting pre-approved. Take a minute to fill out our online form. It’s fast, free, secure and has no obligations. FHA Loan pre-approval has never been easier!

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