FHFA and FHA Announce 2021 Nationwide Mortgage Limits

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The Federal Housing Finance Agency (FHFA) recently announced the maximum conforming loan limits for mortgages to be acquired by Fannie Mae and Freddie Mac in 2021.  The new loan limits for one-unit properties are increased to $548,250 from $510,400.  The limits for one-unit properties in most high-cost areas will rise to $822,375.  Special statutory provisions establish different loan limits for Alaska, Hawaii, Guam, and the U.S. Virgin Islands.  In these areas, the baseline loan limit will be $822,375 for one-unit properties.  A list of the 2021 maximum loan limits for all counties and county-equivalent areas in the U.S. can be found here.

Additionally, the Federal Housing Administration (FHA) recently issued Mortgagee Letter 2020-41 which provides the maximum nationwide mortgage limits for FHA insured single family Title II forward mortgages. These loan limits are effective for case numbers assigned on or after January 1, 2021, through December 31, 2021.  For one-unit properties in low cost areas, the “floor” loan limit is $356,362. In high cost areas, the “ceiling” loan limit is $822,375.  The mortgage limits for Alaska, Hawaii, Guam, and the U.S. Virgin Islands have a “ceiling” of $1,233,550 for a one-unit property. The mortgage limits by county, state, or Metropolitan Statistical Area (MSA) can be found here.

FHA also recently issued Mortgagee Letter 2020-42, which provides the 2021 maximum claim amount for FHA insured Home Equity Conversion (HECM) mortgages.  The maximum claim amount for all areas, including Alaska, Guam, and the U.S. Virgin Islands in 2021 will be $822,375 (150 percent of Freddie Mac’s national conforming limit of $548,250).  This limit is applicable for case numbers assigned on or after January 1, 2021, through December 31, 2021.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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