FHA Announces New Single Family Loan Limits for 2021
By: Nicole Saca
The Federal Housing Administration (FHA) released a new schedule for loan limits for 2021 for single family homes among other updates. This is important news for home buyers! If you apply for an FHA loan, you can purchase a home with a higher price tag. You don’t have to borrow the limit amount, but you can.
FHA loans are mortgages that offer some significant benefits and some drawbacks as well. FHA limits the amount of money you can borrow for a home in each of North Carolina’s counties. If you are unfamiliar with these loans, please read Pros and Cons of an NC FHA Loan.
Most often, the FHA mortgage appeals to
- First-time home buyers.
- Clients with credit scores between 580 and 660.
- Clients who want to make a low down payment.
So assuming your finances are in order to apply for an FHA mortgage (and it is easier to qualify), you can now purchase a home based on higher limits.
- Chatham, Durham, and Orange Counties: $437,000
- Alamance, Lee, Moore and Randolph Counties: $356,362
- Wake County: $371,450
Interested in a different county? Head here, https://entp.hud.gov/idapp/html/hicostlook.cfm
Go figure? What are the limits based on?
Note that you can borrow nearly $100,000 more if purchasing in Chatham, Durham, or Orange counties. That’s because the median home price in those counties is higher. FHA is required by law to set single family loan limits at 115 percent of area median house prices. FHA calculates mortgage limits by Metropolitan Statistical Area (MSA) and county.
The limits can change annually but don’t always, depending on how much a county or MSA housing market experiences home value appreciation.