FHA loans, a type of mortgage guaranteed by the Federal Housing Administration, have limits on how much homeowners can borrow. If you want to buy a home using an FHA loan, you won’t be able to buy a turnkey mansion: FHA loan limits are based on a percentage of the median home price in each county.
The government guarantee on these mortgages is designed to help low- to moderate-income borrowers who might otherwise be shut out of the housing market, but it isn’t supposed to put taxpayers on the hook for extravagant purchases. This guarantee can make FHA loans pricey: Borrowers have to pay upfront mortgage insurance, as well as monthly mortgage insurance premiums—potentially for the life of the loan.
What Is an FHA Loan Limit?
An FHA loan limit represents the maximum amount you can borrow with an FHA loan. The limits are set at the county level and vary based on the type of property you plan to purchase (e.g. single-family properties have lower limits than multi-family properties).
One thing to note is that you can’t automatically borrow up to your county’s limit when getting an FHA loan. You can only borrow as much as you’re qualified for based on your income, credit and other factors. The loan amount also cannot exceed 100% of the property’s appraised value.
FHA Loan Limits
For 2024, the FHA loan limit for a one-unit property in a low-cost area is $498,257. This is referred to as the nationwide loan limit “floor.” The FHA loan limit for a one-unit property in a high-cost area is $1,149,825. This is referred to as the nationwide loan limit “ceiling.” Several hundred counties have limits that fall somewhere between the floor and the ceiling.
FHA Loan Limits by Property Type
FHA loan limits vary by property type. They are lowest for one-unit properties, increase for two-unit properties, increase again for three-unit properties and max out for four-unit properties.
If you want to use an FHA loan to buy a duplex, the limit will be higher than if you want to use an FHA loan to buy a single-family house. And you can, in fact, use an FHA loan to buy a multi-unit property, up to four units, as long as you live in one of the units as your primary residence.
FHA Loan Limits by Property Type for 2024
| Low-cost area | High-cost area | |
|---|---|---|
|
One unit
|
$498,257
|
$1,149,825
|
|
Two units
|
$637,950
|
$1,472,250
|
|
Three units
|
$771,125
|
$1,779,525
|
|
Four units
|
$958,350
|
$2,211,600
|
FHA Loan Limits for Expensive Housing Markets
The 2024 FHA loan limit for a one-unit property in an expensive housing market is $1,149,825, an increase of 5.5% over the 2023 limit of $1,089,300. Expensive markets include the New York, San Francisco and Washington, D.C. housing markets. There are exceptions for Alaska, Hawaii, Guam and the Virgin Islands, where the one-unit limit increases to $1,724,725.
FHA loan limits change each year to reflect changes in home prices.
FHA vs. Conforming Loan Limits
If you want to borrow more money, you’ll need to qualify for a conventional loan instead of an FHA loan. You can qualify for an FHA loan with bad credit—a score as low as 500—if you can put down 10%. With a credit score of 580, you can make a down payment as low as 3.5%. But with a credit score of 620, you may qualify for a conventional loan and a down payment as low as 3%.
With a conventional loan, you’ll potentially be able to borrow up to the conforming loan limits. You’ll still need strong enough finances to qualify, and the home’s appraised value will still need to support the amount you want to borrow. But you may be able to purchase a significantly larger home with access to a higher loan limit.
Related: FHA Loan Calculator: Estimate Your Monthly Loan Payments
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Frequently Asked Questions (FAQs)
What is the income limit for an FHA loan?
FHA loans don’t have minimum or maximum income limits, but they’re intended for low- to moderate-income Americans who cannot qualify for conventional financing or afford the down payment required by other loan types.
What determines the maximum FHA loan limit?
The maximum FHA loan limit is determined by the county in which you live (and the home values within it) and the type of property you intend to purchase. Higher-cost areas and larger, multi-family properties will have higher FHA loan limits.
How do you find FHA loan limits for your area?
The easiest way to find the FHA loan limits for your area is by using the U.S. Department of Housing and Urban Development’s FHA Mortgage Limits search tool.
