Tag: conventional loan limits

2019 FHA Loan Limits

FHA Loan Limits for 2019

FHA Loan Limits Increased for 2019

On December 14, 2018, FHA increased the FHA Loan Limits for new case numbers assigned on or after January 1, 2019. The FHA loan limits have increased from 2018 FHA loan limits of $294,515 to the new floor of $314,827 for 1 UNIT properties.

Related: See our FHA Mortgage Payment Calculator

FHA’s nationwide forward mortgage limit “floor” and “ceiling” for a one-unit property in Calendar Year 2019 are $314,827 and $726,525, respectively. The loan limits in Michigan are based on the number of units of the residence.

2019 FHA Loan and Conventional Loan Limits

MICHIGAN LOAN LIMITSFHACONVENTIONAL
1 UNIT$314,827$484,350
2 UNIT$403,125$620,200
3 UNIT$487,250$749,650
4 UNIT$605525$931,600

Michigan FHA Loan Limits

Michigan does not have any high cost areas therefore the limits for FHA Loans and Conventional Loans are the floor limits. FHA Loan limit in Michigan is $314,827. Conventional Loan Limits in Michigan is $484,350.

Michigan VA Loan Limits

VA loans in Michigan use the Conventional Loan limits of $484,350 set for 2019. All VA loans use the same conventional loan limits which are higher than FHA loan limits.

Michigan USDA Loan Limits

USDA Loans in Michigan are set at the Conventional Loan limits of $484,350 for 2019 as well. All USDA Loans use the same conventional loan limits which are higher than FHA loan limits and allow for more purchasing power.

For More Information on FHA Loan Limits

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Select the links below for additional mortgage limits guidance for forward mortgages:

For Calendar Year 2019, the HECM maximum nationwide claim amount will be $726,525 for all areas. Refer to Mortgagee Letter 18-12 for more details.

2019 Conventional Loan Limits

2019 conventional loan limitsThe Federal Housing Finance Agency (FHFA) announced increased loan limits for the 2019 calendar year for Conventional Home Loans. The maximum conforming loan limits for mortgages to be acquired by Fannie Mae and Freddie Mac in 2019 will be effective for all loans sold on or after January 1st, 2019.  In most of the U.S., the 2019 maximum conforming loan limit for one-unit properties will be $484,350, an increase from $453,100 in 2018.

Fannie Mae and Freddie Mac Baseline Limit Will Increase to $484,350

What is the Conventional Loan Limit on a 2 Unit Property?

The standard Conventional loan limit on a 2 Unit Property is set at $620,200. High costs areas are set at $930,300 conventional loan limit on 2 unit properties.

What is the Conventional Loan Limit on a 3 Unit Property?

The standard Conventional loan limit on a 3 Unit Property is set at $749,650. High costs areas are set at $1,124,475 conventional loan limit on 3 unit properties.

What is the Conventional Loan Limit on a 4 Unit Property?

The standard Conventional loan limit on a 4 Unit Property is set at $931,600. High costs areas are set at $1,139,400 conventional loan limit on 3 unit properties.

How is the Conventional Loan Maximum Calculated?

The Housing and Economic Recovery Act reviews the baseline conforming loan limit and requires that it be adjusted each year for Fannie Mae and Freddie Mac to reflect the change in the average U.S. home price.  When the FHFA published its Q3 2018 House Price Index (HPI) report, data showed that home prices increased by 6.9% on average. This is the amount that the baseline maximum conforming loan limit in will increase for Conventional Loans in 2019.

What is the Conventional Loan Limit for High Cost Areas?

A high cost ares is defined as a place where the local median home value exceeds the baseline confirming loan limit by 115 percent.  For these areas, the “ceiling” is 150 percent of the baseline loan limit. The new ceiling loan limit for one-unit properties in most high-cost areas will be $726,525 — or 150 percent of $484,350.

The new High Cost Conventional Loan Limit is $726,525 for one unit properties.

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2018 Conforming Loan Limits and FHA Loan Limits Increased

On November 28, 2017, it was announced by the Federal Housing Finance Agency, or FHFA, that for 2018 the baseline loan limit for conforming loans will increase from $424,100 to $453,100. This is due to raising house prices and real estate appreciation. According to the FHFA, from the third quarter of 2016 to the third quarter of 2017, home prices have increased at an average of 6.8%. Therefore, conforming loan limits have increased by 6.8%.

Related: 2019 Conventional Loan Limits in Michigan

How are Conforming Loan Limits Calculated?

The new Conventional Loan Limit does not apply to all areas of the United States. There are certain areas in the country that are considered to be high cost, such as Alaska and areas of California. In order for these areas to be deemed as high cost, 115% of the local median home value must exceed the baseline loan limit. In these areas, the baseline loan limit will increase by 150%. This makes the maximum loan limit for these areas $679,650, which was increased from $636,150. A map of the U.S. counties and their maximum loan limits can be found here.  There are no counties in Michigan that are considered to be a high cost area.

2018 FHA Loan Limits Increased

Staring January 1st 2018 FHA Loan Limits have increased its floor to $294,515 from $275,665. This means that buyers can purchase a home of $305,196 with the minimum down payment and still get an FHA loan. In high cost areas, FHA’s loan limit ceiling will increase to $679,650 from the current level of $636,150. In high cost areas, home buyer can purchase a home up to $704,300 and still use the minimum FHA loan down payment of 3.5%.

Do Other Loan Options Have Loan Limits?

USDA and VA loans do not have their own loan limit like FHA. These loan programs utilize Conventional loan limits set by the FHFA. VA may also allow larger loan amounts up to $1,500,000 if the borrower pays the funding fee at the closing over the 453,100 limit.

What if the Loan Size I Need Is Larger than the Loan Limits?

If the loan amount needed exceeds these limits then an option for you would be a non-conforming loan called a jumbo loan. These non-conforming loans follow a different set of guidelines and rates than conforming loans. For 2018, jumbo loans will be for loans that exceed $453,100. Riverbank Finance is also able to help with jumbo loans!

Jumbo Mortgage Loan limits

For loans over the conforming limit of $453,100, we are able to offer jumbo loans. Current Jumbo loan limits at Riverbank are set at 3 million dollars. The purchase price of a property can be above this limit however the buyer would need to pay cash for the difference. Our Jumbo loans options include 40 Year Interest Only Loans, 30 Year Fixed Rate Loans, 15 Year Fixed Rate Loans and Adjustable Rate Mortgages.

What are the Benefits of Conventional Loan Limit Increases?

Loan limits increasing is beneficial to clients as house prices rises because conventional/conforming loans offer the best rates. Higher loan limits allow borrowers to finance higher amount at low fixed rates. Jumbo loans typically do not offer as low of rates as conventional loans do which may be less attractive. Clients will have a wider range of houses they can get financed with a conventional loan. With our 97% Conventional Mortgages, a home buyer could purchase up to a $439,507 home with the minimum 3% down payment. For buyers that plan on utilizing a 20% down payment to avoid PMI, they can not purchase a home for up to $566,375 with 80% financing on a conventional loan.

To confirm the maximum loan amount you qualify for call a Riverbank Loan officer today at 800-555-2098 or request information below!

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