The Department of Housing and Urban Development has made higher FHA-loan limits official.
In a mortgagee letter to approved FHA lenders, Federal Housing Commissioner Brian D. Montgomery laid out the new limits, effective January 1, 2006.
The maximum FHA-insured mortgage on a single-family residence in high-cost areas has been raised to $362,790 from $312,895 this year, according to HUD. In lower cost areas, where most of the prices are less than half of Freddie Mac's conforming limit, the maximum amount is $200,160.
In Alaska, Guam, Hawaii and the Virgin Islands, the maximum is set at 150% of the high-cost area ceiling -- bringing the single-family limit in those to $544,185 for 2006.
The maximum FHA loan amount is based on 87% of Freddie's conforming limit, which was recently raised to $417,000, HUD said.
The two-, three- and four-unit maximum loan amounts in high-cost areas have been raised to $464,449, $561,411 and $697,696, respectively, according to the letter.
The new limits apply to FHA's basic 1-4 family mortgage, Section 203(b); Section 203(k) loans for rehabilitation; Section 234(c) loans for condominium units; and Section 255, for home equity conversion mortgages.
read entire Mortgagee Letter 2005-49