Special lending limits exist for borrowers in Alaska, Hawaii, Guam, and the Virgin Islands due to higher construction costs in these areas. Here's how those limits break down:
- One-unit properties: $1,233,550
- Two-unit properties: $1,579,500
- Three-unit properties: $1,909,125
- Four-unit properties: $2,372,625
If you want to know the exact FHA loan limits for an area you're considering buying in, your best bet is the FHA's search tool. Just input your state, county, and limit type, and you'll see the loan limits for that area in seconds.
You might not qualify for the maximum loan amount
The FHA loan limits are just one part of the equation. In other words, just because the FHA is willing to guarantee a $1.5 million-dollar home loan in your area doesn't necessarily mean that you can qualify to borrow that much.
Lenders consider a few different factors when determining how much you can borrow, with debt-to-income ratio, or DTI, being chief among them. This is your monthly debt obligations divided by your pre-tax monthly income, expressed as a percentage. For example, if your monthly payment obligations are $2,000 per month and you earn $5,000, your DTI is 40%.
Your DTI -- and thus the maximum loan limit -- will be influenced by the following factors:
Keep in mind that there are two types of DTI ratios. The front-end DTI is the percentage of your income that will go toward your mortgage payment. The back-end DTI is the percentage of your income that will go toward all of your monthly obligations, including your mortgage payment.
While many lenders have front-end DTI maximums for FHA loans, the back-end DTI ratio is the more important of the two when it comes to loan approval, so expect a lender to look at your other debt payment obligations closely.
The standard FHA back-end DTI maximum is 43%, but it can go higher if you have what the agency calls "compensating factors." This might include a very large down payment, a flush savings account, or a very good credit score.
Other FHA requirements
Aside from your DTI, there are other requirements you'll need to meet to qualify for an FHA mortgage loan. Here's a look at the agency's current loan standards: