If you looking to purchase a home using an FHA (Federal Housing Administration) loan because you are looking to put a lower down payment, there are limits on how much you can buy. As you probably already know the minimum down payment needed for an FHA loan is 3.5 percent.
Depending on the county you will be purchasing in the loan limits vary. Here’s a breakdown of the FHA loan limits and the maximum purchase price which includes the 3.5 percent down payment.
FHA
County Purchase Price Loan Limit
Los Angeles / Orange $756,218 $729,750
San Bernadino / Riverside $518,135 $500,000
San Diego $722,798 $697,500
FHA stands for Federal Housing Administration; the FHA is an arm of the Department of Housing and Urban Development (HUD). The primary focus of the FHA is to encourage homeownership in the United States. To do this, the FHA insures mortgages against borrower default. By insuring mortgages, the FHA makes homeownership possible for a broader range of buyers.
To qualify for an FHA loan borrowers must meet certain criteria. The FHA requires that borrowers pay the initial mortgage insurance payment and make subsequent premium payments every year. In addition, borrowers are subject to the credit standards established by the FHA. Although FHA mortgage insurance grants flexibility in lending terms, there are limits to the amount of a mortgage loan and type of property. According to the FHA, loan amounts vary by conditions in the borrower’s area. The FHA insures mortgages on single homes and buildings that contain one to four housing units, as long as one of the units is owner-occupied.
FHA purchase price based on minimum down payment of 3.5% effective 2009. These loan limits were updated January 10, 2012. The loan limits may and will change in the future. Contact us for any updates.
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